Contract Management is a vast scope particularly in construction industry wherein a single contract normally finishes from months to years. Managing a contract in any construction project is a tedious task. All pertinent documents must be monitored, diligently recorded and filed before, during and after construction. Changes in construction as we know are inevitable but can be properly managed and controlled. Deviation from the contract, often called change order or variation order are changes brought about by the owner or changes due to site conditions, damages or weather. These changes may not directly affect the contract in terms of time and cost, but both parties must be knowledgeable as to how to control and protect the owner and contractor from any changes necessary in the construction and implementation of the project. In order to manage such changes or variation orders, proper guidelines must be followed.
Knowing and carefully reviewing the contract, following the proper variation procedure and constantly taking in to consideration the risks that may bring about if poor records of everyday activities particularly on change orders would be taxing if the Contractor claims.
Ms. Chona S. Salvahan made a study which objectives were to: (1) identify changes occurring in a residential apartment project. Identify the type, causation and resolution; and (2) identify proper procedure, develop methodology and documentation to control and manage variation or change orders. Identifying the type of change order will help formulate a procedure adapt to the variation.
Conclusion
Based on the case study, the residential apartment project garnered change order that were classified into five (5) categories such as:
1. Addendums – included additional packages outside the scope of the original contract and are entirely different work but necessary for the project.
2. Price Fluctuation – included price adjustments to construction materials used on site specifically on concrete, reinforcement bars, sand and cement used for structural works on site.
3. Variation due to Design Change – these changes may have resulted from design revisions, defects in drawings or contract documents and differing site conditions grouped into main building works and external works package.
4. Damages – were from re-works items or damages due to negligence of other contractors and sub-contractors.
5. Deductions or Omission – included items that were not installed on site and items that were cancelled and were redundant to the design
Variations that were considered under Extra Work are the three (3) Addendums to the contract. While variations directly requested by the Owner to improve serviceability and aesthetic of the building are considered Additional works. One example is the supply and installation aluminum louver to cover the condensing unit of air-conditioning in every apartment. This additional work is considered Directed Change because the instruction to change or add is from the project owner. Other variations resulted from factor that influence the change were considered constructive change as well as Price Fluctuation, Damages and Omissions were all under different situations during implementation of the project.
Factors that contributed to the change were clearly specified in this study. These events in the construction that caused changes generated even before the main building works started. Continuing to the construction, another set of variations emerge during implementation. At this stage, causes may have been different from the causes during the pre-construction stage. Towards completion of the project, changes still occur, seeing the defects and the need to add or enhance serviceability of the development. Current procedure is useful but can be developed to improve processing period and administer each changes lessening the probable effect to the whole project particularly on the cost.
Below are the suggested stages of processing procedure for better time table of change order settlement:
Validation – where entitlement is agreed and analyzing the effect of the change to project cost and schedule.
1. Evaluation – verifying and gathering data to substantiate the claim. It is also the time of determining the true cost of the variation order thru investigation, review of quantities and considerations in estimates. It is also at this time that both parties should concur and agree on quantity, measurement and total cost in order to save time and will only proceed to the next whenever disagreement on cost arises.
2. Negotiation – only and only if both parties cannot arrive into agreement on price, quantities, measurement or methods should resort to this step where the top management is involve in order settling amicably.
3. Final Approval – time when both parties are satisfied with the evaluation, change order is prepared for final documentation and approval.
Special concerns have to be met particularly of this project. Many of the units have already been sold and were committed to deliver to the tenant on specific dates. The project has no luxury of extending the time thru which in trying to satisfy the commitment of the Owner, the construction restrained the project from achieving a more quality and a more organized method in implementing the project. Change order management helped control the changes incurred during construction but not totally eliminate the potential changes. It may prevent these changes to accumulate and later when accumulated can become a bigger claim for the contractor which is more tedious, complicated and time consuming task to process.
Furthermore, prior to implementation and part of Change Order Management is the adding change clause in the contract, formulating variation procedure and setting or allocating time for settlement process. The deliberate inclusion of change clause is similarly important to control probable change order in a construction project. As observed, the other 3 main sources of change on site were the following:
Differing site conditions resulted from defects in the construction of substructure. The previously installed piles were displaced and because of this the foundation design has to be checked and revised. The owner was compelled to review and revise if necessary the whole structural building.
Defects in contract documents where a number of items were not in the drawings or specification but necessary to install or construct on site.
Owner direction or instructions where the rest of the variations were directed by the owner either thru modification of design drawings or changes had to be added for aesthetic reasons. A lot of variations were requested by the owner or unit buyers.
Recommendation
In order to manage Change Order, both parties should identify their right to vary, the Owner right to include change clause to protect their benefit. These change clauses must be anticipated during planning and before composition of the contract. Therefore a meticulous study of the drawings, site conditions and other factors that may affect arise change in the contract and construction. Clear definition of scope of work would minimize the risk of misinterpretation and misjudgment of the work. In a way, changes would be avoided and if items were not included in the contract, it can be easily identified and agreed on. More so, clear distinction of the methods and procedure to use in claiming variations and the authority issuing the VO. This will clearly guide the contractor on how, what and who to talk to in case a change would occur.
Her thesis abstract is copied and posted.
Abstract
Construction industry is often described as a volatile industry which can be true in implementing a project. Construction itself is more often unpredictable due to the different situations a project may face. Changes may occur in the preparation, during construction and even upon completion of the project. The veracity of inconsistent nature of construction, change management procedures must be considered to minimize the effects particularly to project cost, time schedule and overall quality of the project.
Recently, the high turn in of foreign investors and Vietnamese nationals living abroad inspired a number of Developers to venture in High End Apartments. The big challenge for the Vietnam Construction industry is to advance the management styles to cope up with challenges faced in a project. Procedures in managing contract and change orders are viewed to know the effectiveness and liability ensuing steps observed. Disruptions in cash flow and programme when mitigated and handled correctly may create confidence in handling changes that transpire in any project.
However, knowledge and skill in managing this challenging changes and observing effective procedures may eventually create a norm in Project Management system in the industry where tradition of strong relationship among Owner and Contract still prevails.
Friday, 14 January 2011
Thursday, 13 January 2011
Risk Management in PPP Expressway Project in Vietnam: Ha Noi – Hai Phong Expressway Project Case Study
The rapid growth of Vietnam’s economy over the past few years contributes a significant strain on the country’s physical infrastructure. With economic development expected to continue at a rapid pace, pressures on roads, ports and other infrastructure systems will increase. Vietnam’s underlying concern for the last 10 years is a failure to develop infrastructure, which is now become a bottleneck of economic growth.
In next ten years 2010 to 2020, demands for infrastructure investment will increase by 10%, But how the Vietnam government can mobilize such huge capital shortfall for infrastructure investment, while state budget deficit stands at high level for a very long time and the public debt is in high level and in fast increasing trend (the economist newspapers at http://www.economist.com). With these problems, Public-Private Partnerships (PPP) becomes the optimal solution to fill the shortfall of finance resource.
However, until now, there is still no legal concept of PPP or a separate law on PPP in Vietnam. The only current separated regulation for investment under BOT scheme (a kind of PPP model) is Circular No.108/ND-CP dated 27, November, 2009. The Vietnamese Government and relevant ministries recognize need to established PPP’s legal framework to raise capital from the private sector and from banks and credit institutions, regardless of whether they are under domestic or foreign. PPPs regulations, after one year of preparation by MPI and related ministries were issued on 15th November 2010 by Prime Minister.
Until now, there are only few researches have been conducted on risk management in PPP expressway project in Viet Nam. In order to help investors and policy makers to have a better perception on risk management in PPP expressway project in Vietnam, Mr. Vu Van Cao made a case study with the following objectives:
1. identify and assess the key risk in investment under PPP in Viet Nam;
2. how this key risk in investment under PPP in Vietnam are allocated in Ha Noi – Hai Phong expressway project through Project structure; and
3. recommendation for the Project Company to improve mitigation of critical Risk in Ha Noi – Hai Phong expresses way Project
Conclusion
Base on the results of analysis, it can be seen that risk allocation among related stakeholder is not so good and fair because Vietnamese government transfers all critical risks to Project Company and to road users which causes BOT project long period concession; and the Project Company have to take the financial burden leading to company bankruptcy.
Recommendations for Project Company (VIFIDI)
1. Establishing a specified team in charge to investigate the risks through BOT contract and to propose mitigation strategy;
2. Renegotiation with MOT on BOT contract provision on allocation of risks, which are assessed “cannot be accepted”;
3. Need to sharing risks, which are assessed “Accepted” with the third party;
4. Reevaluation of commercial viability of BOT project and recalculation of financial ratio of BOT project (ROE, NPV, and IRR) to reassess feasibility of the project; and
5. Propose to Government to give financial support to fund land acquisition and resettlement to reduce financial burden during construction period because (i) D/E ration level is too high 13.3) and can cause instability in financial situation when project comes into operation (recommended D/E ratio is 3 times following the PPP pilot regulations No. 71/2010/QD –TTg issued by Prime Minister on 9th November 2010); (ii) Concession period is too long (30.36 year) which causes long return for investors.
Recommendation for Ministry of Transportation (MOT) and GOV (Vietnam Government)
The Ha Noi – Hai Phong expressway is the first expressway project invested under BOT in Vietnam. The success of this project can be a good example to attract more private capital investment on expressway development under PPP model. Therefore, GOV and BOT must share the risks with project company and road user in order to help VIDIFI to implement the project successfully. Below are some recommendations for GOV and MOT to follow:
1. Most of the risks in Ha Noi – Hai Phong expressway project have been transferred to the road user and Project Company. It is proposed that the MOT and GOV fund to land acquisition and resettlement in order to reduce financial burden of Project Company and shorten the concession period;
2. GOV has to give Project company right to develop Land expressway to return their capital investment (profit from land development is expected 7.890 billion VND). Project Company needs more finance resources to fund land development project by itself. This causes unintentionally increasing financial burden on investors. Thus, instead of giving the Project Company the right to develop Land expressway to return capital investment, GOV should allow VIDIFI to increase toll rate of existing NHNo.5, and access to preferential loan with low interest rate and long payback period to reduce financial burden, shorten concession period and increasing feasibility of project.
Mr. Cao’s thesis abstract is copied and posted.
Abstract
Recent years in Vietnam, many Public Private Partnership (PPP) expressway projects have been being invested under PPP model. But the Risk management, which is critical factor of project success, is undervaluation by investors and policy maker. This project case study will contribute on increasing perception on risk management of the investors and policy makers in Vietnam. Project case study will indentify, classify and assess the risks in PPP expressway investment in Vietnam and specify the critical risks, for which the investors and policy makers must pay their attention. The investors and policy makers will understand how the above critical risks to be managed through case study of Ha Noi – Hai Phong expressway project. In the case study, the research will assess the risk allocation among three parties including investor (Project Company), public authorities and road users. The research will also propose recommendation for Project Company improving the risk management in case study.
In next ten years 2010 to 2020, demands for infrastructure investment will increase by 10%, But how the Vietnam government can mobilize such huge capital shortfall for infrastructure investment, while state budget deficit stands at high level for a very long time and the public debt is in high level and in fast increasing trend (the economist newspapers at http://www.economist.com). With these problems, Public-Private Partnerships (PPP) becomes the optimal solution to fill the shortfall of finance resource.
However, until now, there is still no legal concept of PPP or a separate law on PPP in Vietnam. The only current separated regulation for investment under BOT scheme (a kind of PPP model) is Circular No.108/ND-CP dated 27, November, 2009. The Vietnamese Government and relevant ministries recognize need to established PPP’s legal framework to raise capital from the private sector and from banks and credit institutions, regardless of whether they are under domestic or foreign. PPPs regulations, after one year of preparation by MPI and related ministries were issued on 15th November 2010 by Prime Minister.
Until now, there are only few researches have been conducted on risk management in PPP expressway project in Viet Nam. In order to help investors and policy makers to have a better perception on risk management in PPP expressway project in Vietnam, Mr. Vu Van Cao made a case study with the following objectives:
1. identify and assess the key risk in investment under PPP in Viet Nam;
2. how this key risk in investment under PPP in Vietnam are allocated in Ha Noi – Hai Phong expressway project through Project structure; and
3. recommendation for the Project Company to improve mitigation of critical Risk in Ha Noi – Hai Phong expresses way Project
Conclusion
Base on the results of analysis, it can be seen that risk allocation among related stakeholder is not so good and fair because Vietnamese government transfers all critical risks to Project Company and to road users which causes BOT project long period concession; and the Project Company have to take the financial burden leading to company bankruptcy.
Recommendations for Project Company (VIFIDI)
1. Establishing a specified team in charge to investigate the risks through BOT contract and to propose mitigation strategy;
2. Renegotiation with MOT on BOT contract provision on allocation of risks, which are assessed “cannot be accepted”;
3. Need to sharing risks, which are assessed “Accepted” with the third party;
4. Reevaluation of commercial viability of BOT project and recalculation of financial ratio of BOT project (ROE, NPV, and IRR) to reassess feasibility of the project; and
5. Propose to Government to give financial support to fund land acquisition and resettlement to reduce financial burden during construction period because (i) D/E ration level is too high 13.3) and can cause instability in financial situation when project comes into operation (recommended D/E ratio is 3 times following the PPP pilot regulations No. 71/2010/QD –TTg issued by Prime Minister on 9th November 2010); (ii) Concession period is too long (30.36 year) which causes long return for investors.
Recommendation for Ministry of Transportation (MOT) and GOV (Vietnam Government)
The Ha Noi – Hai Phong expressway is the first expressway project invested under BOT in Vietnam. The success of this project can be a good example to attract more private capital investment on expressway development under PPP model. Therefore, GOV and BOT must share the risks with project company and road user in order to help VIDIFI to implement the project successfully. Below are some recommendations for GOV and MOT to follow:
1. Most of the risks in Ha Noi – Hai Phong expressway project have been transferred to the road user and Project Company. It is proposed that the MOT and GOV fund to land acquisition and resettlement in order to reduce financial burden of Project Company and shorten the concession period;
2. GOV has to give Project company right to develop Land expressway to return their capital investment (profit from land development is expected 7.890 billion VND). Project Company needs more finance resources to fund land development project by itself. This causes unintentionally increasing financial burden on investors. Thus, instead of giving the Project Company the right to develop Land expressway to return capital investment, GOV should allow VIDIFI to increase toll rate of existing NHNo.5, and access to preferential loan with low interest rate and long payback period to reduce financial burden, shorten concession period and increasing feasibility of project.
Mr. Cao’s thesis abstract is copied and posted.
Abstract
Recent years in Vietnam, many Public Private Partnership (PPP) expressway projects have been being invested under PPP model. But the Risk management, which is critical factor of project success, is undervaluation by investors and policy maker. This project case study will contribute on increasing perception on risk management of the investors and policy makers in Vietnam. Project case study will indentify, classify and assess the risks in PPP expressway investment in Vietnam and specify the critical risks, for which the investors and policy makers must pay their attention. The investors and policy makers will understand how the above critical risks to be managed through case study of Ha Noi – Hai Phong expressway project. In the case study, the research will assess the risk allocation among three parties including investor (Project Company), public authorities and road users. The research will also propose recommendation for Project Company improving the risk management in case study.
Wednesday, 12 January 2011
A Hybrid Stochastic/Mechanistic Model for Determining Bridge Condition Rating
Bridges like other infrastructures such as roads and dams require proper inspection and maintenance programs to reserve bridge structural integrity and to ensure public safety. The structural integrity decreases through time due to several factors such as material degradation, environmental attacks, and an increase in usage over time. The consequence of improper inspection and maintenance programs can cause catastrophic bridge failure.
Dr. Rajwanlop Kumpoopong made a research which focused on developing a hybrid deterioration model that combines the quantitative analysis of damage mechanisms and the stochastic process based on the concept of Markov chain. The proposed model enhances the existing Markov deterioration model in a more reliable condition prediction of bridge elements at the network-level since relevant variables which affect the deterioration of bridge elements are properly addressed. Only the hybrid deterioration model for bridge deck is developed in this research.
The main objective of this research was to develop the methodology for developing the hybrid deterioration model for bridge deck that combines the quantitative analysis of crack mechanism due to truck traffic loads and the stochastic process based on the concept of Markov chain for the network-level bridge management. The methodology is then applied to develop the hybrid deterioration model for bridge deck under truck traffic condition in Thailand as a case study. The secondary objectives of this research were to: (1) study the effect of each truck category on the deterioration of bridge deck; (2) study the effect of upgrading regulatory truck weights on the deterioration of bridge deck; and (3) study the effect of overloaded truck for the transportation of sugarcane on the deterioration of bridge deck.
Conclusions
Bridge deck is the major bridge component that requires significant maintenance effort. The factor that contributes most to the deterioration process of bridge decks is concrete cracking which is directly related to the traffic volume and can be accelerated by increasing truck traffic. Bridge deck deterioration models in most recent bridge management systems are expressed in the form of probabilistic deterioration models such as the Markovian process. The transition probability matrix is developed to capture the deterioration mechanism of bridge decks.
The strength of the Markov deterioration model is its practicality when it is applied to forecast at the network-level bridge management. The condition of the bridge deck over time can simply be predicted through the multiplications of the initial state vector and the transition probability matrix. However, the Markov deterioration model has some weaknesses since the model may not reflect the actual condition of bridge decks. In the Markov chain models, relevant variables which affect the deterioration process of bridge decks, such as changes in traffic volume and environmental conditions are assumed to be constant throughout the analysis period. This may not be realistic and can result in the overestimation or underestimation of the forecasted bridge condition.
This research work aims to develop the methodology for developing the hybrid deterioration model for reinforced concrete (RC) bridge deck that combines the quantitative analysis of crack mechanism due to truck traffic loads and the stochastic process based on the concept of Markov chain for the network-level bridge management.
In this research, the finite element program that can simulate cracks in RC bridge deck due to truck traffic is developed to capture the crack mechanism. The results are presented by S-N relations of RC bridge deck at different levels of damage. The damage is defined in this study as the extent of crack on the bottom surface of the deck slab or the crack level. Distribution curves of the number of trucks required for the crack to reach each crack level are then developed from the simulated S-N relations and the truck weight information. From these distribution curves and the specified truck traffic volume and composition, transition probabilities based on the concept of Markov chain can be calculated. Based on the proposed technique, transition probabilities can be calculated for truck traffic data that is non-homogeneous with respect to both composition and volume which provides the flexibility of the model to be applied to highway bridges of different truck traffic conditions. The effect of specific overloaded trucks on the deterioration of DOH bridge deck is discussed through the case study of the transportation of sugarcane. For practical assessment of the deterioration of DOH bridge deck, a series of distribution curves of the number of trucks required for the crack to reach different crack levels for different truck categories and gross weights is provided.
His dissertation abstract is copied and posted below.
ABSTRACT
The concept of Markov chain has been widely used to predict the condition of bridge deck. The transition probability matrices, which are mostly developed by inspection data and experts’ opinion, are used to capture the deterioration of bridge deck. The Markov deterioration model developed by this approach although states deterioration in probabilistic sense may not be reliable because relevant variables which affect the deterioration of bridge deck such as changes in traffic volume and environmental conditions are not explicitly emphasized in the model. Concrete cracking which can be accelerated by increased truck traffic is the factor that contributes most to the deterioration of bridge deck and should be addressed in the deterioration model. This research work aims to develop the methodology for developing the hybrid deterioration model for reinforced concrete (RC) bridge deck that combines the quantitative analysis of crack mechanism due to truck traffic loads and the stochastic process based on the concept of Markov chain for the network-level bridge management. In this research, the finite element program that can simulate cracks in RC bridge deck due to truck traffic is developed to capture the crack mechanism. The results are presented by S-N relations of RC bridge deck at different levels of damage. The damage is defined in this study as the extent of crack on the bottom surface of the deck slab or the crack level. Distribution curves of the number of trucks required for the crack to reach each crack level are then developed from the simulated S-N relations and the truck weight information. From these distribution curves and the specified truck traffic volume and composition, transition probabilities based on the concept of Markov chain can be calculated. Based on the proposed technique, transition probabilities can be calculated for truck traffic data that is non-homogeneous with respect to both composition and volume which provides the flexibility of the model to be applied to highway bridges of different truck traffic conditions. The methodology is presented through the development of hybrid deterioration model for Thailand Department of Highways (DOH) bridge deck. In the presentation, the effect of each truck category and the effect of upgrading regulatory truck weights on the deterioration of DOH bridge deck are discussed. The effect of specific overloaded trucks on the deterioration of DOH bridge deck is discussed through the case study of the transportation of sugarcane. For practical assessment of the deterioration of DOH bridge deck, a series of distribution curves of the number of trucks required for the crack to reach different crack levels for different truck categories and gross weights is provided.
Dr. Rajwanlop Kumpoopong made a research which focused on developing a hybrid deterioration model that combines the quantitative analysis of damage mechanisms and the stochastic process based on the concept of Markov chain. The proposed model enhances the existing Markov deterioration model in a more reliable condition prediction of bridge elements at the network-level since relevant variables which affect the deterioration of bridge elements are properly addressed. Only the hybrid deterioration model for bridge deck is developed in this research.
The main objective of this research was to develop the methodology for developing the hybrid deterioration model for bridge deck that combines the quantitative analysis of crack mechanism due to truck traffic loads and the stochastic process based on the concept of Markov chain for the network-level bridge management. The methodology is then applied to develop the hybrid deterioration model for bridge deck under truck traffic condition in Thailand as a case study. The secondary objectives of this research were to: (1) study the effect of each truck category on the deterioration of bridge deck; (2) study the effect of upgrading regulatory truck weights on the deterioration of bridge deck; and (3) study the effect of overloaded truck for the transportation of sugarcane on the deterioration of bridge deck.
Conclusions
Bridge deck is the major bridge component that requires significant maintenance effort. The factor that contributes most to the deterioration process of bridge decks is concrete cracking which is directly related to the traffic volume and can be accelerated by increasing truck traffic. Bridge deck deterioration models in most recent bridge management systems are expressed in the form of probabilistic deterioration models such as the Markovian process. The transition probability matrix is developed to capture the deterioration mechanism of bridge decks.
The strength of the Markov deterioration model is its practicality when it is applied to forecast at the network-level bridge management. The condition of the bridge deck over time can simply be predicted through the multiplications of the initial state vector and the transition probability matrix. However, the Markov deterioration model has some weaknesses since the model may not reflect the actual condition of bridge decks. In the Markov chain models, relevant variables which affect the deterioration process of bridge decks, such as changes in traffic volume and environmental conditions are assumed to be constant throughout the analysis period. This may not be realistic and can result in the overestimation or underestimation of the forecasted bridge condition.
This research work aims to develop the methodology for developing the hybrid deterioration model for reinforced concrete (RC) bridge deck that combines the quantitative analysis of crack mechanism due to truck traffic loads and the stochastic process based on the concept of Markov chain for the network-level bridge management.
In this research, the finite element program that can simulate cracks in RC bridge deck due to truck traffic is developed to capture the crack mechanism. The results are presented by S-N relations of RC bridge deck at different levels of damage. The damage is defined in this study as the extent of crack on the bottom surface of the deck slab or the crack level. Distribution curves of the number of trucks required for the crack to reach each crack level are then developed from the simulated S-N relations and the truck weight information. From these distribution curves and the specified truck traffic volume and composition, transition probabilities based on the concept of Markov chain can be calculated. Based on the proposed technique, transition probabilities can be calculated for truck traffic data that is non-homogeneous with respect to both composition and volume which provides the flexibility of the model to be applied to highway bridges of different truck traffic conditions. The effect of specific overloaded trucks on the deterioration of DOH bridge deck is discussed through the case study of the transportation of sugarcane. For practical assessment of the deterioration of DOH bridge deck, a series of distribution curves of the number of trucks required for the crack to reach different crack levels for different truck categories and gross weights is provided.
His dissertation abstract is copied and posted below.
ABSTRACT
The concept of Markov chain has been widely used to predict the condition of bridge deck. The transition probability matrices, which are mostly developed by inspection data and experts’ opinion, are used to capture the deterioration of bridge deck. The Markov deterioration model developed by this approach although states deterioration in probabilistic sense may not be reliable because relevant variables which affect the deterioration of bridge deck such as changes in traffic volume and environmental conditions are not explicitly emphasized in the model. Concrete cracking which can be accelerated by increased truck traffic is the factor that contributes most to the deterioration of bridge deck and should be addressed in the deterioration model. This research work aims to develop the methodology for developing the hybrid deterioration model for reinforced concrete (RC) bridge deck that combines the quantitative analysis of crack mechanism due to truck traffic loads and the stochastic process based on the concept of Markov chain for the network-level bridge management. In this research, the finite element program that can simulate cracks in RC bridge deck due to truck traffic is developed to capture the crack mechanism. The results are presented by S-N relations of RC bridge deck at different levels of damage. The damage is defined in this study as the extent of crack on the bottom surface of the deck slab or the crack level. Distribution curves of the number of trucks required for the crack to reach each crack level are then developed from the simulated S-N relations and the truck weight information. From these distribution curves and the specified truck traffic volume and composition, transition probabilities based on the concept of Markov chain can be calculated. Based on the proposed technique, transition probabilities can be calculated for truck traffic data that is non-homogeneous with respect to both composition and volume which provides the flexibility of the model to be applied to highway bridges of different truck traffic conditions. The methodology is presented through the development of hybrid deterioration model for Thailand Department of Highways (DOH) bridge deck. In the presentation, the effect of each truck category and the effect of upgrading regulatory truck weights on the deterioration of DOH bridge deck are discussed. The effect of specific overloaded trucks on the deterioration of DOH bridge deck is discussed through the case study of the transportation of sugarcane. For practical assessment of the deterioration of DOH bridge deck, a series of distribution curves of the number of trucks required for the crack to reach different crack levels for different truck categories and gross weights is provided.
Tuesday, 11 January 2011
CEIM-SET Congratulates the Graduates of 114th Batch
We would like to congratulate the new graduates who received their diploma during the 114th AIT Graduation Ceremony on December 17, 2010. The names of graduands and their Thesis/Project title are listed below:
DOCTOR OF PHILOSOPHY DEGREE (CEIM)
1. Rajwanlop Kumpoopong
A Hybrid Stochastic/Mechanistic Model for Determining Bridge Condition Rating
MASTER OF ENGINEERING DEGREE (CEIM)
1. Kittichai Kanjanakantika
Risk Factors Affecting Business Diversification in a Real Estate Company
2. Vuong Hai Khoa
Supply Chain Management: A Case Study of Construction Companies in Vietnam
3. Tinn Withayawaragul
Relationship Between Project Phases and Stock Performance: A Study in Stock Exchange of Thailand (SET)
MASTER OF ENGINEERING DEGREE (PROFESSIONAL)
(Area of Specialization: Project Management in Construction)
1. Nguyen Chau Dieu An
Project: A Critical Appraisal of Briefing Clients in the Construction Process: A Case Study of Residential Project
2. Hoang Thi Hai Anh
Project: Risk Management in Price Adjustment Contract: A Case Study of a Construction Project in Vietnam
3. Dang Tuan Anh
Project: Risk Management of Basement Construction Affecting Adjacent Buildings: A Case Study of Construction Project in Ho Chi Minh City, Vietnam
4. Truong Thai Binh
Project: Owner's Involvement in the Preliminary Stage of Real Estate Development: A Project Case Study in Vietnam
5. Nguyen Phan Hoa Binh
Project: Integrated Project Management Assessment for a Development Property Project at the Capital Fund in Vietnam
6. Le Nam Binh
Project: Owner's Project Schedule Management for High-Rise Office Building Projects: A Case Study of the Construction Project of Petrovietnam Finance Centre in Danang City
7. Nguyen Hung Cuong
Project: Delay in Planning, Design and Construction: A Case Study of Residential Development Project in Ho Chi Minh City
8. Le Ngoc Diep
Project: Risks Affecting Construction Cost in Vietnam
9. Do Tran My Thuy
Project: Risk Management in the Design of Large-Scale Construction Projects: Case Studies of an Urban Area and a Highrise Building Project
10. Truong Ngoc Dung
Project: Effectiveness of Feasibility Study Analysis in an Apartment Building Project: A Case Study of a Two Towers-Twenty Six Storey Apartment Project in Ho Chi Minh City
11. Nguyen Duy Thien Giang
Project: Claim Management and Analysis: Case Study of a High Rise Building Project
12. Trinh Thi Thu Ha
Project: Environmental Impacts Assessment in Nam Ly Bridge - Ho Chi Minh City, Vietnam
13. Vo Si Hoai
Project: Schedule Planning and Control in an Engineering, Procurement and Construction Project: The Case of a City Hall Project
14. Le Quang Khanh
Project: Owner's Organization Project Management Maturity: The Case of Petrolimex Saigon
15. Nguyen Trung Kien
Project: Project Owner's Quality Management System - The Case of Sails Tower Project
16. Tran Thanh Liem
Project: Project Management Life Cycle and Risk Management in a New Residential Development Project in Vietnam: The Case Study of the Fifth Street New Residential Project (D2D's Company) and its Secondary Project (Berjaya-D@D Join Venture Company)
17. Nguyen Cao Bao Luat
Project: Design Management in a Design-Build Project Based on the Design Team of Contractor Perspective
18. Vo Dinh Nguyen
Project: Project Management Practice in a Small and Medium Vietnamese Contractor: The Case of Nhat Dang Company
19. Do Huu Phuoc
Project: Owner's Project Life Cycle Approach: The Case of Rubber Plantation Project in a Vietnam Rubber Company
20. Tran Duc Quang
Project: Project Organizational Structure Roles and Responsibility - The Case of Marriott Five-Star Hotel
21. Chona Salvatus Salvahan
Project: Minimizing the Impact of Change Order to Project Costs
22. Nguyen Duy Duc Thu
Project: A Feasibility Study of a Curtain Wall Testing Company in Hanoi
23. Nguyen Le Thuan
Project: Owner's Project Control Strategy
24. Le Mien Thuy
Project: Method and Effectiveness of a Feasibility Study for an Apartment Project: The Case of Carina Plaza Building
25. Nguyen Thu Trang
Project: Application of Fidic Contract in a Bridge Project: The Case of Can Tho Bridge
26. Tran Thi Thien Trang
Project: Assessment of Risks on the Design Management Aspects in Luxury Hotel Development Projects: The Case of Le Meridien Saigon Hotel
27. Nguyen Duc Trong
Project: Organizational Project Management Structure in a Real Estate Developer Company: The Case of Namlong Corporation
MASTER OF SCIENCE DEGREE (PROFESSIONAL)
(Area of Specialization: Project Management in Construction)
1. Mr. Nguyen Duc Thanh
Project: Risk Factors in Vietnam Power Plant Projects: A Case Study of Nhon Trach Power Plant and Camau Gas Power Fertilise Projects
2. Tran Van Trung
Project: The Delay Factors in EPC Contracts in Vietnam: The Case of Uong Bi Thermal Power Plant
3. Mr. Vo Quoc Vinh
Project: Contractual Risks of SME Contractors - A Case Study a of Mechanical and Electrical Contractor
Monday, 10 January 2011
Greetings from CEIM/MPM
Dr. B. H. W. Hadikusumo, Dr. Chotchai Charoenngam and the CEIM/MPM staff wish you a blessed and bountiful year 2011!
Friday, 29 October 2010
Design Management for Architectural Project: A Case Study of PVMTC – Petrovietnam Building Project
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Thursday, 14 October 2010
Success factors for financial sustainability of toll road project in China
The rapid growth of the Chinese economy calls for massive development of infrastructure and assets. Over the past 10 years a national trunk highway system and a network of urban and provincial expressways have emerged in China (World Bank, 2003). A World Bank (2003) research estimated that highway investments in China significantly increased in the late 1990s and reached 2.5 percent of GDP. Still, an estimated $75-100 billion needs to be invested in highway construction over the next 15 years. Toll road is one of infrastructure project that has high ability to attract private investment since it is able to recover directly the costs of its operation and construction through toll charges. While this brings a lot of opportunities to project stakeholders, it also contains various risks that can bring the result that the real project outcomes are very much lower than the expected.
Ms. Truong Thi My Thanh made a study which main objective was to develop the model of success factors for Chinese toll roads to achieve financial sustainability in planning and executing stages and recommend proper consideration from key stakeholders to ensure that toll road project can be sustainable and more attractive to private investment. To complete the main objectives, following sub objectives were explored:
1. Investigate the cost and financial performance of toll roads in China to find out significant attributes influence on the difference of estimated and actual outcomes
2. Investigate the impact of above factors to project finance for short term and long term sustainability.
3. To propose the model for financial sustainability of toll roads in China and provide recommendations for policy makers, international lending institutes and toll road developers as required consideration in planning stage to enhance the certain of financial condition and control the financial sustainability in executing stage.
Conclusions
Toll road is one of infrastructure project that has high ability to attract private investment since it is able to recover directly the costs of its operation and construction through toll charges. Toll road development can be attractive to investors and lenders only if the financial and economic benefit can be met. Financial sustainability is the essential part of this entire criterion, with many attributes should be considered. It is true that the financial sustainability of toll road depends on the performance of all stakeholders involve in project from initial phase to the end of project life cycle. Planning and executing stages are the most important and have high impact to project financial sustainability. Proper considerations to the significant attributes in these two stages need to be taken from involved stakeholders to ensure that long-term survival and sustainability are achieved.
The purpose of studying toll road performance and the impact to financial sustainability is to (1) indentify the significant factors impact to project financial sustainability in planning and executing stages, and (2) recommend proper consideration from key stakeholders to ensure that toll road project can be sustainable and more attractive to private investment.
The study was carried out by examining seven Chinese toll roads with different development model. The focus was to investigate toll road development model, the participation of stakeholders and the risks they had to face with. After that, in-depth analysis is on (1) financial sources (2) financial usages and investment cost variation (3) revenue base (4) operating performance (5) financial benefit and (6) financial sustainable situation. Those attributes were investigated in combination with the involvement of key stakeholders related to projects. A qualitative research was prepared where the data collection techniques are case studies.
From the analysis, the factors impact to project financial sustainability can be divided into five levels (1) Policy support (2) Regional development (3) Fund raising model (4) Project development (5) Financial structure. All these factors are essentially important for project developer’s consideration.
Policy support: This factor covers four significant attributes (1) Government assurance (2) Land acquisition and resettlement policy (3) Toll rate structure and tolling adjustment and (4) Penalty regulation for truck over load. Government assurance provides the legal support to negotiate with ADB/WB to get the loan. The policy support for land acquisition activities reduces the risks of delay and cost overrun. Additionally, the proper toll rate setting and fixed frequency of tolling adjustment ensure the certainty of revenue stream and help toll road developer can foresee the profit. Lastly, the strictly penalty is needed for truck over loading to reduce the maintenance cost of toll roads.
Regional development: Financial sustainability extremely depends on the certainty of project revenue stream which significantly impacted by master plan of regional development. The study found that appropriate point time of investment base on socio-economic situation ensures proper traffic flow after toll road start to operate. Additionally, toll road projects constructed in combination with the upgrading of local toll road network and industrial zones promise the high traffic growth rate and higher revenue stream in the future.
Fund raising model: The study found out that securitisation model for Chinese toll road development has the highest level of long term financial sustainability, because the local government provides very high level of grant and subsidy. Government build and operate model has quite high ability of financial sustainability but lower than securitisation model. Project establishes very high level of contingencies budget even the total cost will increase. Additionally, local government subsidise the over budget of construction cost, hence there will no increase in short term debt and current liabilities. Cooperative joint venture model of toll road in China has lowest level of financial sustainability since it uses very high debt to equity ratio; the debt mostly comes from domestic bank with high interest rate and high interest during construction. Project is developed separately with the improvement of local road network and the expansion of industrial zones because there is limited source of fund of investors.
Project development: It was found that four significant problems closely go along with the development of toll road project, they are inappropriate preparing in feasibility study, improper land acquisition planning, delay in land acquisition implementation and not timely approval of works variations and equipment procurement from ADB/WB. Changes between feasibility design and detailed design because of improper feasibility preparation was the most significant reason caused civil work and land acquisition cost overrun. Resettlement plan, compensation standard and the difference in acquiring temporary and permanent land was carried out ineffectively caused over budget of land cost. Limited budget contributes to the delay of land acquisition activities. The delay of project completion also involved with the insufficient feedback on report ADB/WB required from project executing agency hence delay in resolving problems and difficulties that occurred during project implementation.
Financial structure: This factor covered five significant attributes; they were (1) Debt to equity ratio of capital investment, (2) Government grant, (3) Source of debt, (4) Source of equity and (5) emergency budget for financial consumption overrun. It was found that the D/E split which was used to develop toll road project in China mostly based on the financial health of local government rather than the ability to generate revenue of project itself. The grant from central government was just used to improve some section of feeder roads, hence the amount mostly based on the length and socio-economic condition of the projects while grant from local government was significantly based on the benefit that local government could receive from project. The result showed that the amount of ADB/WB loan had very high impact to financial structure of investment capital since it reduces the debt from domestic bank and the percentage of grant. The study also found out that local government was not yet successful to attract private participation since equity from private sectors still played minor part of investment capital. When project got construction cost overrun project owners used three sources of emergency budget cover investment overrun, they were short term loan from domestic banks, local government subsidy and contingencies budget. Government build and operate model used highest contingencies budget and received fully support in the context of subsidy from local government. Whereas cooperative joint venture model had to find the loan from domestic bank since it used low contingencies budget and not received any subsidy from local government.
Recommendations for critical factors model
The development model for financial sustainability of Chinese toll road has been structured in considering long term and short term impact. Based on the findings from the information of diverse situation, the model has been structured on policy support, regional development, organisational model, project development and financial structure levels. The recommendations for key stakeholders involves in toll road project have also been provided to enhance the financial sustainability of toll road development. The applicability of critical factors model will help policy makers, toll road developers and international lending organisation (ADB and WB) to foresee the sustainability of financial condition of toll road in planning stage through proper master plan for regional development, policy support and effective organisational model. Additionally, the findings also help toll road developers to control and enhance the financial sustainability in executing stage through the risk mitigation instrument in each development step, proper financial structure of investment capital and appropriate sources of fund as emergency budget for financial consumption overrun. Lastly, the applicability of the findings not only used for Chinese toll road developers but for stakeholders in other emerge economy countries as well.
Ms. Truong Thi My Thanh made a study which main objective was to develop the model of success factors for Chinese toll roads to achieve financial sustainability in planning and executing stages and recommend proper consideration from key stakeholders to ensure that toll road project can be sustainable and more attractive to private investment. To complete the main objectives, following sub objectives were explored:
1. Investigate the cost and financial performance of toll roads in China to find out significant attributes influence on the difference of estimated and actual outcomes
2. Investigate the impact of above factors to project finance for short term and long term sustainability.
3. To propose the model for financial sustainability of toll roads in China and provide recommendations for policy makers, international lending institutes and toll road developers as required consideration in planning stage to enhance the certain of financial condition and control the financial sustainability in executing stage.
Conclusions
Toll road is one of infrastructure project that has high ability to attract private investment since it is able to recover directly the costs of its operation and construction through toll charges. Toll road development can be attractive to investors and lenders only if the financial and economic benefit can be met. Financial sustainability is the essential part of this entire criterion, with many attributes should be considered. It is true that the financial sustainability of toll road depends on the performance of all stakeholders involve in project from initial phase to the end of project life cycle. Planning and executing stages are the most important and have high impact to project financial sustainability. Proper considerations to the significant attributes in these two stages need to be taken from involved stakeholders to ensure that long-term survival and sustainability are achieved.
The purpose of studying toll road performance and the impact to financial sustainability is to (1) indentify the significant factors impact to project financial sustainability in planning and executing stages, and (2) recommend proper consideration from key stakeholders to ensure that toll road project can be sustainable and more attractive to private investment.
The study was carried out by examining seven Chinese toll roads with different development model. The focus was to investigate toll road development model, the participation of stakeholders and the risks they had to face with. After that, in-depth analysis is on (1) financial sources (2) financial usages and investment cost variation (3) revenue base (4) operating performance (5) financial benefit and (6) financial sustainable situation. Those attributes were investigated in combination with the involvement of key stakeholders related to projects. A qualitative research was prepared where the data collection techniques are case studies.
From the analysis, the factors impact to project financial sustainability can be divided into five levels (1) Policy support (2) Regional development (3) Fund raising model (4) Project development (5) Financial structure. All these factors are essentially important for project developer’s consideration.
Policy support: This factor covers four significant attributes (1) Government assurance (2) Land acquisition and resettlement policy (3) Toll rate structure and tolling adjustment and (4) Penalty regulation for truck over load. Government assurance provides the legal support to negotiate with ADB/WB to get the loan. The policy support for land acquisition activities reduces the risks of delay and cost overrun. Additionally, the proper toll rate setting and fixed frequency of tolling adjustment ensure the certainty of revenue stream and help toll road developer can foresee the profit. Lastly, the strictly penalty is needed for truck over loading to reduce the maintenance cost of toll roads.
Regional development: Financial sustainability extremely depends on the certainty of project revenue stream which significantly impacted by master plan of regional development. The study found that appropriate point time of investment base on socio-economic situation ensures proper traffic flow after toll road start to operate. Additionally, toll road projects constructed in combination with the upgrading of local toll road network and industrial zones promise the high traffic growth rate and higher revenue stream in the future.
Fund raising model: The study found out that securitisation model for Chinese toll road development has the highest level of long term financial sustainability, because the local government provides very high level of grant and subsidy. Government build and operate model has quite high ability of financial sustainability but lower than securitisation model. Project establishes very high level of contingencies budget even the total cost will increase. Additionally, local government subsidise the over budget of construction cost, hence there will no increase in short term debt and current liabilities. Cooperative joint venture model of toll road in China has lowest level of financial sustainability since it uses very high debt to equity ratio; the debt mostly comes from domestic bank with high interest rate and high interest during construction. Project is developed separately with the improvement of local road network and the expansion of industrial zones because there is limited source of fund of investors.
Project development: It was found that four significant problems closely go along with the development of toll road project, they are inappropriate preparing in feasibility study, improper land acquisition planning, delay in land acquisition implementation and not timely approval of works variations and equipment procurement from ADB/WB. Changes between feasibility design and detailed design because of improper feasibility preparation was the most significant reason caused civil work and land acquisition cost overrun. Resettlement plan, compensation standard and the difference in acquiring temporary and permanent land was carried out ineffectively caused over budget of land cost. Limited budget contributes to the delay of land acquisition activities. The delay of project completion also involved with the insufficient feedback on report ADB/WB required from project executing agency hence delay in resolving problems and difficulties that occurred during project implementation.
Financial structure: This factor covered five significant attributes; they were (1) Debt to equity ratio of capital investment, (2) Government grant, (3) Source of debt, (4) Source of equity and (5) emergency budget for financial consumption overrun. It was found that the D/E split which was used to develop toll road project in China mostly based on the financial health of local government rather than the ability to generate revenue of project itself. The grant from central government was just used to improve some section of feeder roads, hence the amount mostly based on the length and socio-economic condition of the projects while grant from local government was significantly based on the benefit that local government could receive from project. The result showed that the amount of ADB/WB loan had very high impact to financial structure of investment capital since it reduces the debt from domestic bank and the percentage of grant. The study also found out that local government was not yet successful to attract private participation since equity from private sectors still played minor part of investment capital. When project got construction cost overrun project owners used three sources of emergency budget cover investment overrun, they were short term loan from domestic banks, local government subsidy and contingencies budget. Government build and operate model used highest contingencies budget and received fully support in the context of subsidy from local government. Whereas cooperative joint venture model had to find the loan from domestic bank since it used low contingencies budget and not received any subsidy from local government.
Recommendations for critical factors model
The development model for financial sustainability of Chinese toll road has been structured in considering long term and short term impact. Based on the findings from the information of diverse situation, the model has been structured on policy support, regional development, organisational model, project development and financial structure levels. The recommendations for key stakeholders involves in toll road project have also been provided to enhance the financial sustainability of toll road development. The applicability of critical factors model will help policy makers, toll road developers and international lending organisation (ADB and WB) to foresee the sustainability of financial condition of toll road in planning stage through proper master plan for regional development, policy support and effective organisational model. Additionally, the findings also help toll road developers to control and enhance the financial sustainability in executing stage through the risk mitigation instrument in each development step, proper financial structure of investment capital and appropriate sources of fund as emergency budget for financial consumption overrun. Lastly, the applicability of the findings not only used for Chinese toll road developers but for stakeholders in other emerge economy countries as well.
Thursday, 7 October 2010
Quality Management in Construction Projects: A Case Study of Quality Management in Construction Projects of an Oil and Gas Company
Currently, although businesses involved in construction activities apply quality management systems, but in practice there are a lot of poor works that worry people and society. Consequences of poor quality will damage property and waste money of business and community, and it also cause danger to people.
To ensure the effective application of quality management for construction projects, it requires the strong commitment of business leaders and implementation of multiple solutions. Applying this effective quality management will bring many potential benefits for businesses. Mr. Le Van Thong made a research which main objectives were: (1) determination of quality management activities in the construction in the Oil and Gas Company; and (2) to discuss and review the effectiveness of quality management in construction of the Oil and Gas Company
Conclusions
Quality management system has been applied by PTSC companies in their projects. It brings success to the company for many years now, and became a famous company in the international market in oil and gas technical services industry in Vietnam. They are the useful tools to avoid and mitigate problems and to improve quality performances of the following projects. They are the principles that management use to achieve effective cost control, quality control, schedule control etc. Many civil and industry construction Corporations, companies in developed countries have been applied the successful Quality Management and got more profits and reduced lost time and cost for reworks. They recognize the importance of the Quality Management and have responsibilities to identify, assess, prevent and manage all breakdowns and risks to projects, damage to property and working environment.
The quality improvement programs establish actions for achieving the objectives and targets, in line with the policy commitment of continuous improvement. When establishing targets, the following will be taken into consideration:
- Who do? How? Who supervise the provision of information; as executive / coordination / control is assigned in advance and all agents involved must comply.
- The system clearly and closely flexibility have created a positive consequence of works completed on schedule, ensure quality and safety.
Effectiveness of the implementation quality management:
After implementation of the quality management, there are some achieved results as below:
1. Quality Assurance is to obtain completed construction that meets all contract requirements. Assurance is defined as a degree of certainty. Quality assurance personnel continually assure that the contractor's works comply with contract requirements.
2. Quality Control is the successful execution of a realistic plan to ensure that the required standards of quality construction will be met. In QC, the contractor defines procedures to manage and control his own, designer of record, consultant, architect-engineer, all subcontractor and all supplier activities so that the completed project complies with contract requirements. For design-build contracts, this includes providing and maintaining a Design Quality Control plan as a part of the overall contract QC plan. This plan, as a minimum, must assure that all documents are reviewed by a technically competent independent reviewer specifically named in the plan. This review cannot be performed by the same designers that produced the product. The design QC plan must be managed by a Design QC Manager who has verifiable engineering or architectural design experience or is a registered engineer or architect. The Design QC Manager is under the supervision of the QC Manager.
Recommendations
1. The performance of Quality Management must be carried out permanently in the company to prevent all budget overrun, progress slow, reworks maybe happening from the existing projects and future projects.
2. The performance of Quality Management must be concerned from the top management to everybody in the company.
3. Examine the quality control methods being used to determine if the contractor is properly controlling design activities in design-build contracts.
4. Examine the quality control methods being used to determine if the contractor is properly controlling construction activities.
5. Make certain that the necessary changes are made in the contractor's QC system, if excessive construction deficiencies occur.
6. Assist the contractor in understanding and implementing the contract requirements.
7. Examine ongoing and completed work.
8. Produce the quality specified in the plans and specifications and for design-build contracts in the Request for Proposal, as well as the contractor's accepted proposal.
9. Develop and maintain an effective QC system.
10. Perform all control activities and tests.
11. Prepare acceptable documentation of QC activities.
His thesis abstract is copied and posted.
Abstract
In an organization or business will have a lot of construction projects, any project also is importance. Ensure the quality of the project is very important for each organization. Aware of that, the quality management has been applied widely in their construction projects. But how apply the successful model of quality management for a construction project that is still a big question.
Organizations in Vietnam as some other countries, in fact, the signers disclaim the possibility of anticipating and detailing everything in the construction documents. Second, it is unstable for the construction environment. The complexity and size of project vary. Working conditions cannot be somewhat control. The employee is variable; its composition, motivation and size change. Cooperation between contractor and subcontractors is problematic. Those will affect the quality management of construction projects and it makes the project to delay, re-work and increase cost.
So, how to manage the quality of the construction project effectively? This thesis will research about quality management in construction project through theory and real case that is applied in PTSC Production Services Company.
To ensure the effective application of quality management for construction projects, it requires the strong commitment of business leaders and implementation of multiple solutions. Applying this effective quality management will bring many potential benefits for businesses. Mr. Le Van Thong made a research which main objectives were: (1) determination of quality management activities in the construction in the Oil and Gas Company; and (2) to discuss and review the effectiveness of quality management in construction of the Oil and Gas Company
Conclusions
Quality management system has been applied by PTSC companies in their projects. It brings success to the company for many years now, and became a famous company in the international market in oil and gas technical services industry in Vietnam. They are the useful tools to avoid and mitigate problems and to improve quality performances of the following projects. They are the principles that management use to achieve effective cost control, quality control, schedule control etc. Many civil and industry construction Corporations, companies in developed countries have been applied the successful Quality Management and got more profits and reduced lost time and cost for reworks. They recognize the importance of the Quality Management and have responsibilities to identify, assess, prevent and manage all breakdowns and risks to projects, damage to property and working environment.
The quality improvement programs establish actions for achieving the objectives and targets, in line with the policy commitment of continuous improvement. When establishing targets, the following will be taken into consideration:
- Who do? How? Who supervise the provision of information; as executive / coordination / control is assigned in advance and all agents involved must comply.
- The system clearly and closely flexibility have created a positive consequence of works completed on schedule, ensure quality and safety.
Effectiveness of the implementation quality management:
After implementation of the quality management, there are some achieved results as below:
1. Quality Assurance is to obtain completed construction that meets all contract requirements. Assurance is defined as a degree of certainty. Quality assurance personnel continually assure that the contractor's works comply with contract requirements.
2. Quality Control is the successful execution of a realistic plan to ensure that the required standards of quality construction will be met. In QC, the contractor defines procedures to manage and control his own, designer of record, consultant, architect-engineer, all subcontractor and all supplier activities so that the completed project complies with contract requirements. For design-build contracts, this includes providing and maintaining a Design Quality Control plan as a part of the overall contract QC plan. This plan, as a minimum, must assure that all documents are reviewed by a technically competent independent reviewer specifically named in the plan. This review cannot be performed by the same designers that produced the product. The design QC plan must be managed by a Design QC Manager who has verifiable engineering or architectural design experience or is a registered engineer or architect. The Design QC Manager is under the supervision of the QC Manager.
Recommendations
1. The performance of Quality Management must be carried out permanently in the company to prevent all budget overrun, progress slow, reworks maybe happening from the existing projects and future projects.
2. The performance of Quality Management must be concerned from the top management to everybody in the company.
3. Examine the quality control methods being used to determine if the contractor is properly controlling design activities in design-build contracts.
4. Examine the quality control methods being used to determine if the contractor is properly controlling construction activities.
5. Make certain that the necessary changes are made in the contractor's QC system, if excessive construction deficiencies occur.
6. Assist the contractor in understanding and implementing the contract requirements.
7. Examine ongoing and completed work.
8. Produce the quality specified in the plans and specifications and for design-build contracts in the Request for Proposal, as well as the contractor's accepted proposal.
9. Develop and maintain an effective QC system.
10. Perform all control activities and tests.
11. Prepare acceptable documentation of QC activities.
His thesis abstract is copied and posted.
Abstract
In an organization or business will have a lot of construction projects, any project also is importance. Ensure the quality of the project is very important for each organization. Aware of that, the quality management has been applied widely in their construction projects. But how apply the successful model of quality management for a construction project that is still a big question.
Organizations in Vietnam as some other countries, in fact, the signers disclaim the possibility of anticipating and detailing everything in the construction documents. Second, it is unstable for the construction environment. The complexity and size of project vary. Working conditions cannot be somewhat control. The employee is variable; its composition, motivation and size change. Cooperation between contractor and subcontractors is problematic. Those will affect the quality management of construction projects and it makes the project to delay, re-work and increase cost.
So, how to manage the quality of the construction project effectively? This thesis will research about quality management in construction project through theory and real case that is applied in PTSC Production Services Company.
Monday, 4 October 2010
Investigation of Change Order Management: A Case Study of Oil & Gas Projects
Oil and gas project is very complex and changes could easily happen anytime. These projects mostly are huge with many phases such as engineering, procurement, fabrication, installation, pre-commissioning, commissioning for offshore facilities, and oil and gas platforms. They are considered to be very risky because of their complications and difficult conditions with high level of safety and requires big amount of money. Therefore cause of changes should be identified and classified.
Mr. Le Dang Thuc made a research which main objective was to study the change order management in EPC Oil & Gas Projects. The other objectives of his research were to: (1) investigate the different kinds of change order in oil and gas project; (2) assess the impact of change order in terms of cost and time; (3) investigate the change order process in oil and gas project; and (4) recommend ways to improve change order management in oil and gas.
Conclusion
Administering impact of change order in EPC oil and gas project is very significant to reduce time and cost and guarantee the success of the project. In order to do that, management of cost and time attached special importance to invest and innovate. There are five key concepts to manage impact with cost such as design cost breakdown structure, cost estimating, setting contingency, cost monitoring & control. The setting of contingency in contract price is to cover the cost in order to reduce risk and the unforeseeable events. To manage change order in term of time, the baseline and progress must be updated and reported.
In this study, several cause of change order were identified: alteration to specification, alteration to scope of work, alteration to contract, alteration to schedule, in which activity is unsafe under certain conditions; activity does not meet legal or regulatory requirements and others (example weather, political climate, etc).
Impacts of change order
According to five case studies, the impacts of change order in terms of additional cost are alteration to Scope of Work, alteration to Specification, others (Bad weather, Crane broken), and activity is unsafe under certain conditions. While the impacts of change order in terms of time are alteration to scope of work and others (Bad weather, broken Crane). Frequent types of change order were also identified such as alteration to scope of work, alteration to specification; activity is unsafe under certain conditions, Others (Bad weather, broken Crane), and alteration to schedule.
Time and cost impacts play an important role to prevent more extra time and cost during the execution. In CNV cases, it showed that the cost impact in construction phase is almost always high, as it is related to changes in costs of materials, risks in construction, designing, under pressure of schedule progress, and labor requirements during certain times of year, etc. Contract management is very complex and involves many phases, especially in oil and gas projects. Factors such as time, cost and quality have been managed strictly and change order forms are core parts of contract administration.
After studying and analyzing five different case studies, it has been found that the main cause of change order is the alteration to scope of work (78%). This happens due to reason such as change decision, change basis of design, location, and lack of estimation of scope of work. Alteration to scope of work is also the most cautious change order. This should pay more attention in contract dealings and should avoid happening. If there are alterations to scope of work, it will affect so much to project in term of cost and scheduling of project. Alteration to scope of work should be reduced and become a lessons learned for future project.
Change Order Process
Change order procedure is very significant to manage changes. This thesis shows a procedure for oil and gas project with 3 scenarios:
1. Client Originated changes - In the event that the Client requests the Contractor to prepare an estimate for a potential change, it shall be made formally by an instruction in writing from the Client. After the review and data input including time and cost, cause of change, the contractor will send VR to client for approval within a time frame. The client will check the VR with their requirement and issue a Variation order to execute project.
2. Contractor originated changes - Contractor identifies the change. They check the change in terms of time and cost, the relation with Client account, and then send to Client for review and approval. Within reasonable time, Client shall endorse the VR and return to Contractor. Client will follow this up with the issuance of VO.
3. Subcontract related changes - When changes occur, Subcontractor may consider giving rise to a claim for additional costs. The Subcontractor will immediately notify the Contractor via official communication. The Contractor responds by reviewing and approves the SVR.
These procedures will help company to be ready to cope with the change, as well as support for smooth execution of the project. To implement this procedure, all member need to understand and each step must be clear. To improve change order, system should be audited many times and innovated after seeing the mistake of sequence. The Project manager responds to guide all parties and all member of project team for clear and ready application.
Recommendation
In order to reduce change order, the project management system should be improved and include the following factors:
His thesis abstract is copied and posted.
Abstract
Oil and gas projects are very complex with huge budget therefore they are easy to raise change during execution of project. A lot of factors affect the project during execution of the project. Many problems could happen unforeseeably to the upcoming part of the project. Engineering Procurement Construction (EPC) process is complex and related to a large variety of variables therefore occurrence of changes in the scope of work is almost inevitable. Many factors such as financing, definition of work and regulatory matters also insert a certain degree of uncertainty into the project. The management of the change is very significant to prevent the impact of change order. Management system and identification cause of change should be play important role. The finding out what is repetitive causes will help Project team has a focal point to manage change order.
The causes of change are classified into 7 types which are based on the various parameters such as specification, scope of work, contract, schedule, etc. All of these changes are defined and analyzed.
In order to know how they administer in term of time and cost impact, this research has been assessed the 5 case studies and analysis is based on the cost estimate system, cost control, planning. Control research refers to the change order management system as per historical data of projects to identify the cause and the impact of change order. After studying and analyzing five different case studies, it has been found that the repetitive cause of change orders are alteration to scope of work. This happens due to the poor project management systems as estimation system, change decision, change basis of design, location, lack of estimation of scope of work and change order procedures.
Change order in oil and gas sector require leaders who can balance budgets and launch schedules and stay on task, because if a project is deemed too costly or late, it can delay the whole mission for months. Cost impact in construction phase is very high; therefore it is needed to pay attention during this period. To reduce change order, the scope of work should be clear. Cost estimates system use contingency in estimating a budget to cover rick, labor, project management system use responsibility break down, select expert vendor to supply material.
Time Impact in design phase is highest because of the following lack of communication, many deviations in design, change location and change design basis.
It is necessary to establish a change order procedure system to ensure effective project execution. A change management system will help a company to be ready to cope with changes and support smooth execution of projects.
Mr. Le Dang Thuc made a research which main objective was to study the change order management in EPC Oil & Gas Projects. The other objectives of his research were to: (1) investigate the different kinds of change order in oil and gas project; (2) assess the impact of change order in terms of cost and time; (3) investigate the change order process in oil and gas project; and (4) recommend ways to improve change order management in oil and gas.
Conclusion
Administering impact of change order in EPC oil and gas project is very significant to reduce time and cost and guarantee the success of the project. In order to do that, management of cost and time attached special importance to invest and innovate. There are five key concepts to manage impact with cost such as design cost breakdown structure, cost estimating, setting contingency, cost monitoring & control. The setting of contingency in contract price is to cover the cost in order to reduce risk and the unforeseeable events. To manage change order in term of time, the baseline and progress must be updated and reported.
In this study, several cause of change order were identified: alteration to specification, alteration to scope of work, alteration to contract, alteration to schedule, in which activity is unsafe under certain conditions; activity does not meet legal or regulatory requirements and others (example weather, political climate, etc).
Impacts of change order
According to five case studies, the impacts of change order in terms of additional cost are alteration to Scope of Work, alteration to Specification, others (Bad weather, Crane broken), and activity is unsafe under certain conditions. While the impacts of change order in terms of time are alteration to scope of work and others (Bad weather, broken Crane). Frequent types of change order were also identified such as alteration to scope of work, alteration to specification; activity is unsafe under certain conditions, Others (Bad weather, broken Crane), and alteration to schedule.
Time and cost impacts play an important role to prevent more extra time and cost during the execution. In CNV cases, it showed that the cost impact in construction phase is almost always high, as it is related to changes in costs of materials, risks in construction, designing, under pressure of schedule progress, and labor requirements during certain times of year, etc. Contract management is very complex and involves many phases, especially in oil and gas projects. Factors such as time, cost and quality have been managed strictly and change order forms are core parts of contract administration.
After studying and analyzing five different case studies, it has been found that the main cause of change order is the alteration to scope of work (78%). This happens due to reason such as change decision, change basis of design, location, and lack of estimation of scope of work. Alteration to scope of work is also the most cautious change order. This should pay more attention in contract dealings and should avoid happening. If there are alterations to scope of work, it will affect so much to project in term of cost and scheduling of project. Alteration to scope of work should be reduced and become a lessons learned for future project.
Change Order Process
Change order procedure is very significant to manage changes. This thesis shows a procedure for oil and gas project with 3 scenarios:
1. Client Originated changes - In the event that the Client requests the Contractor to prepare an estimate for a potential change, it shall be made formally by an instruction in writing from the Client. After the review and data input including time and cost, cause of change, the contractor will send VR to client for approval within a time frame. The client will check the VR with their requirement and issue a Variation order to execute project.
2. Contractor originated changes - Contractor identifies the change. They check the change in terms of time and cost, the relation with Client account, and then send to Client for review and approval. Within reasonable time, Client shall endorse the VR and return to Contractor. Client will follow this up with the issuance of VO.
3. Subcontract related changes - When changes occur, Subcontractor may consider giving rise to a claim for additional costs. The Subcontractor will immediately notify the Contractor via official communication. The Contractor responds by reviewing and approves the SVR.
These procedures will help company to be ready to cope with the change, as well as support for smooth execution of the project. To implement this procedure, all member need to understand and each step must be clear. To improve change order, system should be audited many times and innovated after seeing the mistake of sequence. The Project manager responds to guide all parties and all member of project team for clear and ready application.
Recommendation
In order to reduce change order, the project management system should be improved and include the following factors:
His thesis abstract is copied and posted.
Abstract
Oil and gas projects are very complex with huge budget therefore they are easy to raise change during execution of project. A lot of factors affect the project during execution of the project. Many problems could happen unforeseeably to the upcoming part of the project. Engineering Procurement Construction (EPC) process is complex and related to a large variety of variables therefore occurrence of changes in the scope of work is almost inevitable. Many factors such as financing, definition of work and regulatory matters also insert a certain degree of uncertainty into the project. The management of the change is very significant to prevent the impact of change order. Management system and identification cause of change should be play important role. The finding out what is repetitive causes will help Project team has a focal point to manage change order.
The causes of change are classified into 7 types which are based on the various parameters such as specification, scope of work, contract, schedule, etc. All of these changes are defined and analyzed.
In order to know how they administer in term of time and cost impact, this research has been assessed the 5 case studies and analysis is based on the cost estimate system, cost control, planning. Control research refers to the change order management system as per historical data of projects to identify the cause and the impact of change order. After studying and analyzing five different case studies, it has been found that the repetitive cause of change orders are alteration to scope of work. This happens due to the poor project management systems as estimation system, change decision, change basis of design, location, lack of estimation of scope of work and change order procedures.
Change order in oil and gas sector require leaders who can balance budgets and launch schedules and stay on task, because if a project is deemed too costly or late, it can delay the whole mission for months. Cost impact in construction phase is very high; therefore it is needed to pay attention during this period. To reduce change order, the scope of work should be clear. Cost estimates system use contingency in estimating a budget to cover rick, labor, project management system use responsibility break down, select expert vendor to supply material.
Time Impact in design phase is highest because of the following lack of communication, many deviations in design, change location and change design basis.
It is necessary to establish a change order procedure system to ensure effective project execution. A change management system will help a company to be ready to cope with changes and support smooth execution of projects.
Friday, 1 October 2010
Special Purpose Vehicle in Toll-Road Project Development: A Case Study of the National Highway 14 Project in Vietnam
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Wednesday, 29 September 2010
Improving Quality Assurance in Construction: Can Tho Storage Tank Capacity Enhancement Project Case Study, Vietnam
After implementing the first stage of the quality assurance and product improvement in construction program, Vietnam Minister of construction assessed that although the program has achieved success in the first stage, there are some difficulties need to be overcome comparing with the goal and requirements planned. Annually, accidents still happen on working site due to violation of quality management process and procedure. Lacks of owner’s care, some commissioning buildings have no operation and maintenance manuals. This leads to degradation, reduction of the building’s life span and become unsecured in operation (instruction of Vietnam Ministry of construction, 2006).
Quality in construction is measured through time, cost and scope in traditional way. Andrew argued that these indicators are simple and crude to gauge the project quality. Owners are more quality-driven than price and value driven (Dainty, 2003). Especially, in oil and gas facilities, expensive equipments related to each other in manufacturing line. If one component fails, the other will be affected like the domino effect. So it is necessary to recognize other components affecting construction quality in each stage of project life cycle through assessing effectiveness and efficiency of construction processes. From that point, processes can improve that satisfy the external and internal customers. As a result, the existence and success of Vietnam enterprises are confirmed in local and international arena as well.
Mr. Duong Thanh Hai made a study which main three objectives were: (1) modeling the construction quality assurance activities from design to commissioning in traditional procurement; (2) investigating problems in term of effectiveness and efficiency of processes and sub-processes in the model that affect quality issues; and (3) developing a tentative model that incorporates construction activities and quality improvement approaches addressing such problems.
Conclusion
1. Modeling the construction quality assurance activities from design to commissioning in traditional procurement
The case was the storage tank project using design-bid-build procurement approach. The owner had in-house staff working as construction management. The owner stated their needs to design consultant. The designer mapped out all construction law, codes and standards that have to be complied with and to control and assure project quality.
Based on the design, the owner gave the quality requirements to site surveyor, supervisor, and contractor. Then these people submitted their quality plans that satisfy those requirements. A quality assurance model was developed based on the discussion with project participants and analyzing archive. The model shows interaction among involved parties from design to commissioning.
2. Investigating problems in term of effectiveness and efficiency of processes and sub-processes in the model that affect quality issues
There were five major problems happened in the project because the involved parties violated the quality plan and also because of the gaps on those quality plans itself.
Problem 1: design materials unavailability in the market
The design materials are only available during the time that the consultant planned the design. During the procurement, the owner realized shortage then the designer had to re-work.
Problem 2: delay in pressing piles
Although all operating procedures were clearly stated in the quality plans, mistakes still took place. The bearing capacities of pressed piles were not the same as the designed figures. According to the plan, the contractor would have informed the designer when problems happened but they did not. As a result, the schedule was delayed.
Problem 3: supply delay of floating roofs
Floating roof equipments were supplied two months late. Those equipment trades were solely based on contract which the contractor cannot assure the supply on time. The contract had just compensated direct loss for contractor. Other indirect loss such as reputation, administrative, low morale actually cannot be recovered.
Problem 4: valves leakage
Design valves were not received on time because of the delay in supply. The contractor used temporary valves to replace designed valves during tank process testing. Unfortunately, the temporary valves cannot bear the oil load, so they leaked. Some arrangements should be carried out to make sure that supplies are available when needed rather than recovered from contract breach penalty.
Problem 5: oil leakage of existing tank system
Underground pipeline were maintained every 10 year. However, those pipelines failed one year before that time. Therefore, one burning accident happened during the transferring process of existing tanks. The underground pipeline should be monitored gradually during that period.
3. Developing a tentative model that incorporates construction activities and quality improvement approaches addressing such problems
In Petromekong, most of construction applied traditional procurement. Contractor requested for supplier’s quotation after they had got bid. However in oil and gas industry, oil constructions usually need long lead time materials and equipment. For this reason, the contractor faces delay of supply sometimes. The study illustrated “supplier partnership” approach should be used in such type of construction to improve procurement quality. Petromekong in-house investing department will arrange partnership with suppliers beforehand. Then the owner, suppliers, designer will optimize time, cost, quality and satisfaction trade-off for important long lead time equipments and materials.
A chain of tools is suggested to detect and solve those problems in advance. Quality improvement tools such as flowchart, check sheet, problem source investigating chart, brainstorming, affinity diagram, fish bone diagram, nominal group technique should be used orderly to improve certain construction processes. Such types of process are repetitive, measurable and have clear procedures. Company can monitor and record performance of those processes regularly. Whenever problems happen, company can immediately recognize warning signs and take actions beforehand.
His thesis abstract is copied and posted.
Abstract
Since Vietnam has had oil terminal system development plan, more tank projects have been invested to expand storage capacity. However, quality violation has been alert obviously. From that point, the study suggests model to identify and eliminate those problems beforehand.
The study used one tank project as case study to fulfill three objectives. Firstly, quality assurance processes in traditional procurement were modeled. Then, the researcher investigated problems adhering to these processes. Finally, an improving quality model was suggested addressing those problems.
The case study was collected from Petromekong Corporation located in southern part of Vietnam. The researcher utilized focus group qualitative method. The researcher discussed with investing department of Petromekong to elicit quality assurance activities of project participants. Then, the researcher defined five problems existing in the case: deigning unavailable material on market, delaying in pressing piles, supply delay of floating roofs, leakage of valves and oil leakage of existing tank system. The researcher looked for some quality improvement approaches from manufacturing industry since. Finally, after conducting expert’s assessment, the researcher demonstrated “supplier partnership” approach should be used in long lead time materials and equipment construction to improve procurement quality. Illustrating pile driving and oil transferring processes as examples, the researcher suggested a chain of tools to detect and solve those problems in the case study beforehand. Such tools are flowchart, check sheet, problem source investigating chart, brainstorming, affinity diagram, fish bone diagram, nominal group technique should be used orderly to improve repetitive, measurable and clear procedure construction processes.
Key word: quality assurance, Petromekong, oil storage tank, traditional procurement, quality improvement, construction problems, case study, Vietnam.
Quality in construction is measured through time, cost and scope in traditional way. Andrew argued that these indicators are simple and crude to gauge the project quality. Owners are more quality-driven than price and value driven (Dainty, 2003). Especially, in oil and gas facilities, expensive equipments related to each other in manufacturing line. If one component fails, the other will be affected like the domino effect. So it is necessary to recognize other components affecting construction quality in each stage of project life cycle through assessing effectiveness and efficiency of construction processes. From that point, processes can improve that satisfy the external and internal customers. As a result, the existence and success of Vietnam enterprises are confirmed in local and international arena as well.
Mr. Duong Thanh Hai made a study which main three objectives were: (1) modeling the construction quality assurance activities from design to commissioning in traditional procurement; (2) investigating problems in term of effectiveness and efficiency of processes and sub-processes in the model that affect quality issues; and (3) developing a tentative model that incorporates construction activities and quality improvement approaches addressing such problems.
Conclusion
1. Modeling the construction quality assurance activities from design to commissioning in traditional procurement
The case was the storage tank project using design-bid-build procurement approach. The owner had in-house staff working as construction management. The owner stated their needs to design consultant. The designer mapped out all construction law, codes and standards that have to be complied with and to control and assure project quality.
Based on the design, the owner gave the quality requirements to site surveyor, supervisor, and contractor. Then these people submitted their quality plans that satisfy those requirements. A quality assurance model was developed based on the discussion with project participants and analyzing archive. The model shows interaction among involved parties from design to commissioning.
2. Investigating problems in term of effectiveness and efficiency of processes and sub-processes in the model that affect quality issues
There were five major problems happened in the project because the involved parties violated the quality plan and also because of the gaps on those quality plans itself.
Problem 1: design materials unavailability in the market
The design materials are only available during the time that the consultant planned the design. During the procurement, the owner realized shortage then the designer had to re-work.
Problem 2: delay in pressing piles
Although all operating procedures were clearly stated in the quality plans, mistakes still took place. The bearing capacities of pressed piles were not the same as the designed figures. According to the plan, the contractor would have informed the designer when problems happened but they did not. As a result, the schedule was delayed.
Problem 3: supply delay of floating roofs
Floating roof equipments were supplied two months late. Those equipment trades were solely based on contract which the contractor cannot assure the supply on time. The contract had just compensated direct loss for contractor. Other indirect loss such as reputation, administrative, low morale actually cannot be recovered.
Problem 4: valves leakage
Design valves were not received on time because of the delay in supply. The contractor used temporary valves to replace designed valves during tank process testing. Unfortunately, the temporary valves cannot bear the oil load, so they leaked. Some arrangements should be carried out to make sure that supplies are available when needed rather than recovered from contract breach penalty.
Problem 5: oil leakage of existing tank system
Underground pipeline were maintained every 10 year. However, those pipelines failed one year before that time. Therefore, one burning accident happened during the transferring process of existing tanks. The underground pipeline should be monitored gradually during that period.
3. Developing a tentative model that incorporates construction activities and quality improvement approaches addressing such problems
In Petromekong, most of construction applied traditional procurement. Contractor requested for supplier’s quotation after they had got bid. However in oil and gas industry, oil constructions usually need long lead time materials and equipment. For this reason, the contractor faces delay of supply sometimes. The study illustrated “supplier partnership” approach should be used in such type of construction to improve procurement quality. Petromekong in-house investing department will arrange partnership with suppliers beforehand. Then the owner, suppliers, designer will optimize time, cost, quality and satisfaction trade-off for important long lead time equipments and materials.
A chain of tools is suggested to detect and solve those problems in advance. Quality improvement tools such as flowchart, check sheet, problem source investigating chart, brainstorming, affinity diagram, fish bone diagram, nominal group technique should be used orderly to improve certain construction processes. Such types of process are repetitive, measurable and have clear procedures. Company can monitor and record performance of those processes regularly. Whenever problems happen, company can immediately recognize warning signs and take actions beforehand.
His thesis abstract is copied and posted.
Abstract
Since Vietnam has had oil terminal system development plan, more tank projects have been invested to expand storage capacity. However, quality violation has been alert obviously. From that point, the study suggests model to identify and eliminate those problems beforehand.
The study used one tank project as case study to fulfill three objectives. Firstly, quality assurance processes in traditional procurement were modeled. Then, the researcher investigated problems adhering to these processes. Finally, an improving quality model was suggested addressing those problems.
The case study was collected from Petromekong Corporation located in southern part of Vietnam. The researcher utilized focus group qualitative method. The researcher discussed with investing department of Petromekong to elicit quality assurance activities of project participants. Then, the researcher defined five problems existing in the case: deigning unavailable material on market, delaying in pressing piles, supply delay of floating roofs, leakage of valves and oil leakage of existing tank system. The researcher looked for some quality improvement approaches from manufacturing industry since. Finally, after conducting expert’s assessment, the researcher demonstrated “supplier partnership” approach should be used in long lead time materials and equipment construction to improve procurement quality. Illustrating pile driving and oil transferring processes as examples, the researcher suggested a chain of tools to detect and solve those problems in the case study beforehand. Such tools are flowchart, check sheet, problem source investigating chart, brainstorming, affinity diagram, fish bone diagram, nominal group technique should be used orderly to improve repetitive, measurable and clear procedure construction processes.
Key word: quality assurance, Petromekong, oil storage tank, traditional procurement, quality improvement, construction problems, case study, Vietnam.
Friday, 24 September 2010
Public Private Partnership in Low-Income Housing Development in Vietnam
Infrastructure development plays a vital role in economic growth and poverty reduction (WB, 2003). Traditionally, infrastructure systems have been provided by public sector. However, the increasing need of new infrastructure development and maintenance of existing infrastructure systems demands a huge capital investment which cannot be achieved by public fund. Public-Private Partnership delivery has become a solution for funding problem by mobilizing private sector fund into infrastructure investment (ADB, 2008). With their innovation and management skill, private participation can increase productivity and efficiency of operation, improve the quality of service and reduce service price compared to public sector provision (ADB, 2008).
In order to keep pace with the increase in housing demand and improve poor housing condition, scaling up investment in housing sector is the urgent focus of Vietnamese government. And in order to reduce state budget investment, Vietnam government is currently seeking possible solutions to develop public private partnership in infrastructure investment, and especially in low-income housing development.
Mr. Truong Ngoc Quy made a study which main objective is to propose the possible solution to encourage private participate in low-income housing development in HCMC. In accomplishing the main objective, the following sub-objectives have to achieve:
1. Develop general public private partnership framework in low-income housing development and its assessment criteria.
2. Investigate current practice of public private partnership in low-income housing development in Vietnam using the developed general model
3. Assess current practice of public private partnership of low-income housing development in Vietnam based on developed assessment criteria.
4. Propose the recommendation for setting up applicable public private partnership model in low-income housing development in Vietnam.
Research Findings
1. General public private partnership model in low-income housing development and its assessment criteria
Five factors of PPP in LIH development which are constructed from extensive literature review and expert verification are (1) government support to private participation, (2) government imposition on private party, (3) government subsidies for low-income people, (4) control target group policy, and (5) tenure system. Also from literature review and expert verification, the nine assessment criteria which are constructed and divided into 3 groups related to three main parties in low-income housing development are (1) affordability, accessibility, and availability for low-income people (2) profitability, availability, accessibility of incentives for private developers (3) sustainability, effectiveness, and inclusiveness.
2. Investigate current practices of public private partnership in low-income housing development in Vietnam
Many issues related to government support for private sector, imposition on developers, subsidies for LIP, control of target group, and tenure system in Vietnam. Facing the problem related to government support, private developers in Vietnam cannot receive some important incentives such as land and financing subsidies which are promised to give by government. The maximum profit margin of 10% and minimum cost recovery at least for 10 years for both hire-purchase and installment payment or for 20 years for rental houses make this market segment unattractive to private sector. The minimum planning and designing standard, and controlling maximum profit margin are lack of detail guideline for public authority and private developer during implementation. The housing finance subsidy in government policy is not strong to provide affordable loan condition to low-income people. Moreover, the loan condition actual provided to LIP is less favorable than what is introduced in policy. Because of under-table money using in allocation system and lack of detailed guidelines to prevent resale and renting out allocated units, most of the housing units are occupied by ineligible people. The actual tenure system is less favorable to low-income people than the imposed tenure system in government policy due to lack of profit in planning tenure system of government policy.
3. Assess the current practice of public private partnership in low-income housing development in Vietnam
Most low-income people in Vietnam face difficulty in affording payment condition and serving debt due to high debt service, high portion of down payment, and high housing price. The quantity of housing available to LIP is low, and the housing finance subsidy is also low in term of both quantity and quality. Housing subsidies including low-income housing subsidized units, housing finance and subsidized information is difficult to access for LIP. The low-profit margin and long term cost recovery set by government is not attractive for private participation. Some important incentives such as off-take guarantee and faster legislation procedure are not introduced in government policy and most incentives in government regulation are not provided in reality. Moreover, most provided incentives such as tax, financing, and basis infrastructure are not given to developer because they are not included in project cost when calculating profit margin. Complex legislation procedure in receiving incentives makes it difficult for developer to access these incentives. The LIH program does not provide housing for migrant and not focus on non-government officials due to its strict selection criteria, and does not cover other housing need due to unsuitable minimum design standard. Another issue related to effectiveness of program is that it is not effective in attracting private participation due to low profit set by government, reducing housing price because of the profit margin ceiling policy, and allocating housing to eligible people due to under-table money using and unclear controlling guideline after sale. Because of its low actual incentives and low actual subsidies provided, the financial sustainability of government budget is not affected much.
His thesis abstract is copied and posted.
ABSTRACT
One of global problem is inadequate condition of urban housing, and it is most serious issues in developing countries. The pressing issue of Vietnam at the mean time is providing adequate housing for residents, especially for poor people living in urban area. In order to reduce state budget investment in housing development for the poor, Vietnam government is currently seeking possible solutions to develop public private partnership in low-income housing development. However, it is still lack of public private partnership in low-income housing development even though government has implemented incentives policy to encourage private participation since 2001. The purpose of this study is seeking possible solution to develop practice of public private partnership in low-income housing development.
This research was conducted by case study methodology to fulfill four study objectives. Firstly, general framework and its assessment criteria for public private partnership in low-income housing development were developed and verified by expert. Secondly, the current practices of public private partnership in low-income housing development in Vietnam are investigated base on developed general framework. Thirdly, following developed assessment criteria, the current practices of public private partnership in low-income housing development in Vietnam are assessed. Fourthly, recommendation for setting up applicable public private partnership in low-income housing development in Vietnam is made.
The result of this study found there is a big gap between government policy and actual implementation of public private partnership in low-income housing development in Vietnam. The government program is not effective in solving housing needs. Low-income people still face difficult in buying the houses. The low-income housing market is not attractive to private developer. Housing finance institute, housing saving fund, and national housing authority are recommended to be set up and play important roles in supporting both demand side and supply side of low-income housing market.
In order to keep pace with the increase in housing demand and improve poor housing condition, scaling up investment in housing sector is the urgent focus of Vietnamese government. And in order to reduce state budget investment, Vietnam government is currently seeking possible solutions to develop public private partnership in infrastructure investment, and especially in low-income housing development.
Mr. Truong Ngoc Quy made a study which main objective is to propose the possible solution to encourage private participate in low-income housing development in HCMC. In accomplishing the main objective, the following sub-objectives have to achieve:
1. Develop general public private partnership framework in low-income housing development and its assessment criteria.
2. Investigate current practice of public private partnership in low-income housing development in Vietnam using the developed general model
3. Assess current practice of public private partnership of low-income housing development in Vietnam based on developed assessment criteria.
4. Propose the recommendation for setting up applicable public private partnership model in low-income housing development in Vietnam.
Research Findings
1. General public private partnership model in low-income housing development and its assessment criteria
Five factors of PPP in LIH development which are constructed from extensive literature review and expert verification are (1) government support to private participation, (2) government imposition on private party, (3) government subsidies for low-income people, (4) control target group policy, and (5) tenure system. Also from literature review and expert verification, the nine assessment criteria which are constructed and divided into 3 groups related to three main parties in low-income housing development are (1) affordability, accessibility, and availability for low-income people (2) profitability, availability, accessibility of incentives for private developers (3) sustainability, effectiveness, and inclusiveness.
2. Investigate current practices of public private partnership in low-income housing development in Vietnam
Many issues related to government support for private sector, imposition on developers, subsidies for LIP, control of target group, and tenure system in Vietnam. Facing the problem related to government support, private developers in Vietnam cannot receive some important incentives such as land and financing subsidies which are promised to give by government. The maximum profit margin of 10% and minimum cost recovery at least for 10 years for both hire-purchase and installment payment or for 20 years for rental houses make this market segment unattractive to private sector. The minimum planning and designing standard, and controlling maximum profit margin are lack of detail guideline for public authority and private developer during implementation. The housing finance subsidy in government policy is not strong to provide affordable loan condition to low-income people. Moreover, the loan condition actual provided to LIP is less favorable than what is introduced in policy. Because of under-table money using in allocation system and lack of detailed guidelines to prevent resale and renting out allocated units, most of the housing units are occupied by ineligible people. The actual tenure system is less favorable to low-income people than the imposed tenure system in government policy due to lack of profit in planning tenure system of government policy.
3. Assess the current practice of public private partnership in low-income housing development in Vietnam
Most low-income people in Vietnam face difficulty in affording payment condition and serving debt due to high debt service, high portion of down payment, and high housing price. The quantity of housing available to LIP is low, and the housing finance subsidy is also low in term of both quantity and quality. Housing subsidies including low-income housing subsidized units, housing finance and subsidized information is difficult to access for LIP. The low-profit margin and long term cost recovery set by government is not attractive for private participation. Some important incentives such as off-take guarantee and faster legislation procedure are not introduced in government policy and most incentives in government regulation are not provided in reality. Moreover, most provided incentives such as tax, financing, and basis infrastructure are not given to developer because they are not included in project cost when calculating profit margin. Complex legislation procedure in receiving incentives makes it difficult for developer to access these incentives. The LIH program does not provide housing for migrant and not focus on non-government officials due to its strict selection criteria, and does not cover other housing need due to unsuitable minimum design standard. Another issue related to effectiveness of program is that it is not effective in attracting private participation due to low profit set by government, reducing housing price because of the profit margin ceiling policy, and allocating housing to eligible people due to under-table money using and unclear controlling guideline after sale. Because of its low actual incentives and low actual subsidies provided, the financial sustainability of government budget is not affected much.
His thesis abstract is copied and posted.
ABSTRACT
One of global problem is inadequate condition of urban housing, and it is most serious issues in developing countries. The pressing issue of Vietnam at the mean time is providing adequate housing for residents, especially for poor people living in urban area. In order to reduce state budget investment in housing development for the poor, Vietnam government is currently seeking possible solutions to develop public private partnership in low-income housing development. However, it is still lack of public private partnership in low-income housing development even though government has implemented incentives policy to encourage private participation since 2001. The purpose of this study is seeking possible solution to develop practice of public private partnership in low-income housing development.
This research was conducted by case study methodology to fulfill four study objectives. Firstly, general framework and its assessment criteria for public private partnership in low-income housing development were developed and verified by expert. Secondly, the current practices of public private partnership in low-income housing development in Vietnam are investigated base on developed general framework. Thirdly, following developed assessment criteria, the current practices of public private partnership in low-income housing development in Vietnam are assessed. Fourthly, recommendation for setting up applicable public private partnership in low-income housing development in Vietnam is made.
The result of this study found there is a big gap between government policy and actual implementation of public private partnership in low-income housing development in Vietnam. The government program is not effective in solving housing needs. Low-income people still face difficult in buying the houses. The low-income housing market is not attractive to private developer. Housing finance institute, housing saving fund, and national housing authority are recommended to be set up and play important roles in supporting both demand side and supply side of low-income housing market.
Thursday, 23 September 2010
Development of a Worker Engagement Measurement Tool (WEMT) for Construction Safety Program
Many studies revealed that construction industry has the highest risks compared with other industries, risks that sometimes lead to death.
Each construction companies have their own safety measures implementation. But how to lessen if not totally eliminate this kind of accidents is everybody’s concern especially those who are working in the construction sites.
Dr. Oulawan Kulchartchai made a research to find the answer to the following questions:
• How can worker engagement in safety program implementation be assessed?
- What process should be used to develop Worker Engagement Measurement Tool (WEMT)?
- What are the components/elements of worker engagement?
• What are the factors that affect worker engagement in safety program implementation?
• What are the critical factors contributing to the success of worker engagement in safety program implementation?
The general objective of her research is to develop an assessment tool to measure worker engagement in the safety program implementation. This assessment should allow managers to assess the real status of their workers from the workers’ views, and then provide adequate actions to improve worker engagement. To accomplish these, the specific objectives of the study are set out and identified as the following:
• To develop a reliable assessment tool in order to measure worker engagement in safety program implementation in construction projects.
• To identify critical factors of successful worker engagement (WE) in safety program implementation
Conclusion on Answers to the Questions
In assessing the worker engagement in safety program implementation, two questions must be addressed: first; what are the components/elements of worker engagement? And second; what is that the process that should be used to develop worker engagement measurement tool?
On assessing worker engagement in safety program implementation:
a. What process should be used to develop Worker Engagement Measurement Tool (WEMT)?
The literature reviewed revealed that there is a lack of empirical data on many of the measures of an engagement in construction area, particularly for the workers. The development of a worker engagement measurement tool, which is perceived to be valid, should clearly reflect the emerging research perspectives on engagement. The tool should look at the total context (cognitive, affective, and psychomotor domain) and not focus on a singular dimension (the degree of freedom for workers to make their own decisions regarding health and safety issues).
Ground theory analysis was adopted to define the concept ‘worker engagement’ and associated descriptive elements.
Lawshe's (1975) quantitative content validity technique was used to determine the perception of safety experts based on the model or framework on worker engagement and its descriptive elements. The results derived from the content validity technique showed that fifty-three (53) out of the seventy-eight (78) descriptive elements were included in the validity assessment questionnaire of a worker engagement). The element consisted of cognitive domain (21 items), affective domain (26 items), and psychomotor domain (6 items), and content validity index as perceived by safety experts which are 0.72, 0.60, and 0.43 respectively. It can be concluded that the theoretical construct of the worker engagement model and descriptive elements were verified and thus acceptable for use in the development of a worker engagement measurement tool.
b. What are the components/elements of worker engagement?
To determine the components/elements of worker engagement, a process was needed to initially develop a worker engagement measurement tool. By using triangulation techniques, models including the scale development process were developed. This process was also used by Du Plessis (2004), and was based from DeVellis’s work (1991) as supported by the latter study from Clark and Watson’s (1995). The theoretical model construct was derived from the related literature study. To get the descriptive elements of worker engagement, Grounded Theory’s techniques were applied. The data was verified by safety experts using Lawshe’s techniques. The verified items were subjected to item analysis and exploratory factor analysis techniques using SPSS (Statistical Package for the Social Sciences) software. The reliability test in SPSS was adopted through the Independent sample, t-test.
In conclusion, the questions above could be positively answered from the literature reviewed and qualitative study. These answers provided the background to the empirical part of the study and supported the inputs to the primary objective.
The secondary objective of this study is ‘to identify critical factors of successful worker engagement (WE) in safety program implementation’. To accomplish this objective, two steps were considered: (1) the common factors affecting worker engagement in safety program implementation; and (2) the critical factors contributing to the success of worker engagement in safety program implementation.
Based on a learning theoretical model, factors affecting worker engagement in safety program implementation can be grouped into situation related factors and individual related factor. Although many psychological and management literatures have studied engagement factors, little work in current literature attempted to explore the factors contributing to worker engagement in safety programs implementation at construction projects. Therefore, the qualitative and quantitative studies were carried out.
In order to identify the affecting factors, a qualitative study was done using the Grounded Theory’s technique. Subsequently, the factors were verified using Lawshe’s techniques. The results indicated that affecting factor consists of situation-related factor (31 items) and individual related factors (12 items) and the content validity index as perceived by safety experts are 0.56 and 0.59 respectively. It can be concluded that the affecting factors which were perceived by experts were valid.
Conclusion and Answer to the Primary Objective Worker Engagement Measurement Tool (WEMT)
A worker engagement measurement tool (WEMT) was developed. This tool has a six-factor scale and a total of 39 items. This was derived from applying the research process which included Grounded Theory’s techniques, Lawshe’s techniques, the development of a scale instrument by using DeVellis’s (1991) process, and a reliability test of the developed worker engagement measurement tool by using Independent sample, t-test
The statistical techniques such as item analysis and exploratory factor analysis in SPSS was applied on the initial 78 variables under the three construct theoretical model developed from a learning theory and Kahn’s initial theoretical model, then worker engagement concept and associated descriptive elements were identified by utilizing Grounded theory and then verified by safety experts.
The final conclusion that can be made to answer the primary research objective is that the worker engagement measurement tool (WEMT) developed through this research is holistic in nature and measures a total worker engagement construct by means of the six factors; is reliable (statistically proven); can be used as a diagnostic tool because it can significantly distinguish between projects; and is perceived to have a valid construct.
Conclusion and Answer to the Secondary Objective Factor Affecting Worker Engagement
The factors affecting worker engagement consisted of six factors and had 29 items in total. This data was the output from series of analysis. After numerous literature researches, the theory was found relevant to this study.
The final conclusion answers “what are the critical factors contributing to the success of worker engagement in safety program implementation?” Safety policy, supportive management and supervisor behavior factor, and individual related factors were considered as the critical factors affecting to worker engagement in safety program implementation, whereas, workplace climate, communication and feedback, and reward and recognition were perceived by the respondents as the factors that need considerable attention in order to improve worker engagement in safety programs implementation.
Her thesis abstract is copied and posted.
ABSTRACT
The construction industry is considered to have the highest rate of fatal occupational injuries in many countries. In Thailand, the accident rate in the construction industry is reportedly the highest compared to other industries. Fatal injuries to workers occur more often in construction industry. Previous research emphases often analyze the effective safety programs rather than those that are geared towards creating safe working environments. Workers are expected to play and act as the “key driver” in safety program implementation. Due to this, worker engagement is now considered to be one of the most important approaches in reducing work-related injuries and diseases. Without this worker engagement, safety programs will be difficult to achieve. It is hypothesized that worker engagement can substantially reduce accidents and improve safety performance continuously.
The primary objective of this study was ‘to develop a reliable assessment tool to measure worker engagement in safety program implementation in construction projects” and ‘to identify critical factors of successful worker engagement (WE) in safety program implementation’. The findings therefore will enable construction firms to identify gaps in worker engagement within the safety program implementation, and facilitate improvements.
This study used triangulation techniques including; theoretical model construct by a thorough literature study, components of worker engagement indicated by Grounded Theory’s techniques, verification of the theoretical model using Lawshe’s techniques, the development of a scale instrument by using DeVellis’s (1991) process supported by Clark and Watson’s (1995) and used by Du Plessis (2004), a reliability test of the developed worker engagement measurement tool by using Independent sample, t-test.
In developing the WEMT, several consultation and tests were conducted with national safety experts. Results showed that worker engagement (WE) consisted of 3 domains; cognitive (21 items), affective (26 items), and psychomotor (6 items). The content validity index of the domains according to safety experts are 0.72, 0.60, and 0.43 respectively. Additionally, the situation-related factor (31 items) and individually related factors (12 items) with respect to the content validity index were 0.56 and 0.59 respectively. A questionnaire with 53 variables in three dimensions of worker engagement and 43 variables in affecting factor was distributed to the sample group of construction workers and personnel basis either by electronic-mail or hand carried to the representative sample group of 494. Approximately fifty two percent (258/494) responded anonymously. A scale instrument was developed through the item analysis and exploratory factor analysis function of the Statistical Package for the Social Sciences (SPSS).
A worker engagement measurement tool (WEMT) comprised of 39 items in a six-factor instrument was developed. It was found that the items in these factors were highly acceptable, receiving a Cronbach alpha coefficient above 0.8.
The developed WEMT was tested in two distinct construction projects in Oil&Gas and Building projects. These test confirmed that WEMT was a reliable diagnostic tool that can discriminate worker engagement level among different projects, particularly in the Thai construction firm context.
This research also determined factors that affect worker engagement within the safety program implementation. These factors are important when guided contractors to increase worker engagement level. This study showed that suitable safety policies, a supportive management team, and individually related factors were critical and directly affects the worker engagement in safety program implementation. Workplace climate, communication and feedback, and reward and recognition were perceived by the respondents as the factors that need considerable attention to improve worker engagement.
This research is relevant because it was able to identify a reliable worker engagement measurement tool that enables projects to identify the overall level of worker engagement in safety program implementation. This tool will serve to facilitate strategic actions to improve the working situations, thereby optimizing safety program implementation for continuous safety movements. The implementation of such strategies will be a forward move towards beginning and sustaining safety program implementation for further safety performance improvement within industries, particularly in Thailand.
Key words:
Worker engagement measurement tools, worker engagement, construction project, grounded theory, scale development, affecting factors.
Each construction companies have their own safety measures implementation. But how to lessen if not totally eliminate this kind of accidents is everybody’s concern especially those who are working in the construction sites.
Dr. Oulawan Kulchartchai made a research to find the answer to the following questions:
• How can worker engagement in safety program implementation be assessed?
- What process should be used to develop Worker Engagement Measurement Tool (WEMT)?
- What are the components/elements of worker engagement?
• What are the factors that affect worker engagement in safety program implementation?
• What are the critical factors contributing to the success of worker engagement in safety program implementation?
The general objective of her research is to develop an assessment tool to measure worker engagement in the safety program implementation. This assessment should allow managers to assess the real status of their workers from the workers’ views, and then provide adequate actions to improve worker engagement. To accomplish these, the specific objectives of the study are set out and identified as the following:
• To develop a reliable assessment tool in order to measure worker engagement in safety program implementation in construction projects.
• To identify critical factors of successful worker engagement (WE) in safety program implementation
Conclusion on Answers to the Questions
In assessing the worker engagement in safety program implementation, two questions must be addressed: first; what are the components/elements of worker engagement? And second; what is that the process that should be used to develop worker engagement measurement tool?
On assessing worker engagement in safety program implementation:
a. What process should be used to develop Worker Engagement Measurement Tool (WEMT)?
The literature reviewed revealed that there is a lack of empirical data on many of the measures of an engagement in construction area, particularly for the workers. The development of a worker engagement measurement tool, which is perceived to be valid, should clearly reflect the emerging research perspectives on engagement. The tool should look at the total context (cognitive, affective, and psychomotor domain) and not focus on a singular dimension (the degree of freedom for workers to make their own decisions regarding health and safety issues).
Ground theory analysis was adopted to define the concept ‘worker engagement’ and associated descriptive elements.
Lawshe's (1975) quantitative content validity technique was used to determine the perception of safety experts based on the model or framework on worker engagement and its descriptive elements. The results derived from the content validity technique showed that fifty-three (53) out of the seventy-eight (78) descriptive elements were included in the validity assessment questionnaire of a worker engagement). The element consisted of cognitive domain (21 items), affective domain (26 items), and psychomotor domain (6 items), and content validity index as perceived by safety experts which are 0.72, 0.60, and 0.43 respectively. It can be concluded that the theoretical construct of the worker engagement model and descriptive elements were verified and thus acceptable for use in the development of a worker engagement measurement tool.
b. What are the components/elements of worker engagement?
To determine the components/elements of worker engagement, a process was needed to initially develop a worker engagement measurement tool. By using triangulation techniques, models including the scale development process were developed. This process was also used by Du Plessis (2004), and was based from DeVellis’s work (1991) as supported by the latter study from Clark and Watson’s (1995). The theoretical model construct was derived from the related literature study. To get the descriptive elements of worker engagement, Grounded Theory’s techniques were applied. The data was verified by safety experts using Lawshe’s techniques. The verified items were subjected to item analysis and exploratory factor analysis techniques using SPSS (Statistical Package for the Social Sciences) software. The reliability test in SPSS was adopted through the Independent sample, t-test.
In conclusion, the questions above could be positively answered from the literature reviewed and qualitative study. These answers provided the background to the empirical part of the study and supported the inputs to the primary objective.
The secondary objective of this study is ‘to identify critical factors of successful worker engagement (WE) in safety program implementation’. To accomplish this objective, two steps were considered: (1) the common factors affecting worker engagement in safety program implementation; and (2) the critical factors contributing to the success of worker engagement in safety program implementation.
Based on a learning theoretical model, factors affecting worker engagement in safety program implementation can be grouped into situation related factors and individual related factor. Although many psychological and management literatures have studied engagement factors, little work in current literature attempted to explore the factors contributing to worker engagement in safety programs implementation at construction projects. Therefore, the qualitative and quantitative studies were carried out.
In order to identify the affecting factors, a qualitative study was done using the Grounded Theory’s technique. Subsequently, the factors were verified using Lawshe’s techniques. The results indicated that affecting factor consists of situation-related factor (31 items) and individual related factors (12 items) and the content validity index as perceived by safety experts are 0.56 and 0.59 respectively. It can be concluded that the affecting factors which were perceived by experts were valid.
Conclusion and Answer to the Primary Objective Worker Engagement Measurement Tool (WEMT)
A worker engagement measurement tool (WEMT) was developed. This tool has a six-factor scale and a total of 39 items. This was derived from applying the research process which included Grounded Theory’s techniques, Lawshe’s techniques, the development of a scale instrument by using DeVellis’s (1991) process, and a reliability test of the developed worker engagement measurement tool by using Independent sample, t-test
The statistical techniques such as item analysis and exploratory factor analysis in SPSS was applied on the initial 78 variables under the three construct theoretical model developed from a learning theory and Kahn’s initial theoretical model, then worker engagement concept and associated descriptive elements were identified by utilizing Grounded theory and then verified by safety experts.
The final conclusion that can be made to answer the primary research objective is that the worker engagement measurement tool (WEMT) developed through this research is holistic in nature and measures a total worker engagement construct by means of the six factors; is reliable (statistically proven); can be used as a diagnostic tool because it can significantly distinguish between projects; and is perceived to have a valid construct.
Conclusion and Answer to the Secondary Objective Factor Affecting Worker Engagement
The factors affecting worker engagement consisted of six factors and had 29 items in total. This data was the output from series of analysis. After numerous literature researches, the theory was found relevant to this study.
The final conclusion answers “what are the critical factors contributing to the success of worker engagement in safety program implementation?” Safety policy, supportive management and supervisor behavior factor, and individual related factors were considered as the critical factors affecting to worker engagement in safety program implementation, whereas, workplace climate, communication and feedback, and reward and recognition were perceived by the respondents as the factors that need considerable attention in order to improve worker engagement in safety programs implementation.
Her thesis abstract is copied and posted.
ABSTRACT
The construction industry is considered to have the highest rate of fatal occupational injuries in many countries. In Thailand, the accident rate in the construction industry is reportedly the highest compared to other industries. Fatal injuries to workers occur more often in construction industry. Previous research emphases often analyze the effective safety programs rather than those that are geared towards creating safe working environments. Workers are expected to play and act as the “key driver” in safety program implementation. Due to this, worker engagement is now considered to be one of the most important approaches in reducing work-related injuries and diseases. Without this worker engagement, safety programs will be difficult to achieve. It is hypothesized that worker engagement can substantially reduce accidents and improve safety performance continuously.
The primary objective of this study was ‘to develop a reliable assessment tool to measure worker engagement in safety program implementation in construction projects” and ‘to identify critical factors of successful worker engagement (WE) in safety program implementation’. The findings therefore will enable construction firms to identify gaps in worker engagement within the safety program implementation, and facilitate improvements.
This study used triangulation techniques including; theoretical model construct by a thorough literature study, components of worker engagement indicated by Grounded Theory’s techniques, verification of the theoretical model using Lawshe’s techniques, the development of a scale instrument by using DeVellis’s (1991) process supported by Clark and Watson’s (1995) and used by Du Plessis (2004), a reliability test of the developed worker engagement measurement tool by using Independent sample, t-test.
In developing the WEMT, several consultation and tests were conducted with national safety experts. Results showed that worker engagement (WE) consisted of 3 domains; cognitive (21 items), affective (26 items), and psychomotor (6 items). The content validity index of the domains according to safety experts are 0.72, 0.60, and 0.43 respectively. Additionally, the situation-related factor (31 items) and individually related factors (12 items) with respect to the content validity index were 0.56 and 0.59 respectively. A questionnaire with 53 variables in three dimensions of worker engagement and 43 variables in affecting factor was distributed to the sample group of construction workers and personnel basis either by electronic-mail or hand carried to the representative sample group of 494. Approximately fifty two percent (258/494) responded anonymously. A scale instrument was developed through the item analysis and exploratory factor analysis function of the Statistical Package for the Social Sciences (SPSS).
A worker engagement measurement tool (WEMT) comprised of 39 items in a six-factor instrument was developed. It was found that the items in these factors were highly acceptable, receiving a Cronbach alpha coefficient above 0.8.
The developed WEMT was tested in two distinct construction projects in Oil&Gas and Building projects. These test confirmed that WEMT was a reliable diagnostic tool that can discriminate worker engagement level among different projects, particularly in the Thai construction firm context.
This research also determined factors that affect worker engagement within the safety program implementation. These factors are important when guided contractors to increase worker engagement level. This study showed that suitable safety policies, a supportive management team, and individually related factors were critical and directly affects the worker engagement in safety program implementation. Workplace climate, communication and feedback, and reward and recognition were perceived by the respondents as the factors that need considerable attention to improve worker engagement.
This research is relevant because it was able to identify a reliable worker engagement measurement tool that enables projects to identify the overall level of worker engagement in safety program implementation. This tool will serve to facilitate strategic actions to improve the working situations, thereby optimizing safety program implementation for continuous safety movements. The implementation of such strategies will be a forward move towards beginning and sustaining safety program implementation for further safety performance improvement within industries, particularly in Thailand.
Key words:
Worker engagement measurement tools, worker engagement, construction project, grounded theory, scale development, affecting factors.
Monday, 20 September 2010
Project Owner’s Quality Management System – A case study of Estella Residential Development Building Construction Project
In recent years, generally, in construction industry, it is recognized that the construction sector has made a great contribution to national development as investment has been intensified in many fields such as infrastructure development, industry and public projects. However, more attention should be given to quality management because of the poor quality of some construction projects.
To enhance the quality control of construction projects, the Ministry of Construction (MOC) held a seminar on April 28, 2009 which the main concern to ensure the quality of construction projects, especially for large-scale national projects. While most projects have operated on a safe and cost-effective basis, there remain shortcomings in terms of quality at different levels due to international and external causes. Because of these reasons, the development of quality management system is most important not only for Contractors, Quality Consultants, but for the investors or developers as well.
Mr. Tran Hong Quan made a study which primary objective was to study the application of Quality Management System (QMS) of Project Owner in a construction project from design to construction phase.
Conclusions
In general, most of the requirements of quality system have been covered and presented in the existing system. However, the discovered problems that related in missing contract review, improper developed coordination and communication, lack of the process control, control of quality records and the inspection status monitoring during the course of work are the reasons that caused major problems to owner such as schedule delay and generating V.O.
In addition, it was found out that there was inconsistency in decision relating to quality on job site caused rework and schedule delay.
Obviously, besides the reason of work procedures, it would be the reasons of different quality level and quality perception. Therefore, it is necessary to conduct the internal quality audit and provide training at different position in order to gain the same level of quality perception in the project team.
Through the discussion and findings of this study, the causes and the consequences that generated by these missing processes can be summarized in the table below:
To summarize, refer to the study, in order to obtain a complete QMS, the missing requirements as previous mentioned should be added in the existing Quality Management System for fulfillment. More than that, the quality culture in organization should be formed up so that the Company can reach to the Total Quality Management.
His thesis abstract is copied and posted.
Abstract
The report expresses the key issues in Quality Management System (QMS) that known as the critical factor for any organization wants to develop and survive in the free trade market.
This study, which refers to the theories and the standards system, has expressed the concept of quality in construction, the QMS in organization, system requirements for owner’s QMS in construction and its benefits. The study has briefed the factors that most effect to project quality studied from public reports and the key points to control project quality from the design to construction stage. The report has introduced a QMS to the property developer for the purpose of amendment to the existing QMS in order to obtain a complete QMS for better managing project quality.
The next part of this report is the case study on the Estella J.V organization that established to run and deliver the Estella Residential Development project, an international project of the Keppel Land Co. Ltd. Through this case study, the findings on the existing QMS and the application from the previous part to this existing QMS for improvement will be the foundation QMS for toward Keppel Land’ projects. This is also the objective of this study.
To enhance the quality control of construction projects, the Ministry of Construction (MOC) held a seminar on April 28, 2009 which the main concern to ensure the quality of construction projects, especially for large-scale national projects. While most projects have operated on a safe and cost-effective basis, there remain shortcomings in terms of quality at different levels due to international and external causes. Because of these reasons, the development of quality management system is most important not only for Contractors, Quality Consultants, but for the investors or developers as well.
Mr. Tran Hong Quan made a study which primary objective was to study the application of Quality Management System (QMS) of Project Owner in a construction project from design to construction phase.
Conclusions
In general, most of the requirements of quality system have been covered and presented in the existing system. However, the discovered problems that related in missing contract review, improper developed coordination and communication, lack of the process control, control of quality records and the inspection status monitoring during the course of work are the reasons that caused major problems to owner such as schedule delay and generating V.O.
In addition, it was found out that there was inconsistency in decision relating to quality on job site caused rework and schedule delay.
Obviously, besides the reason of work procedures, it would be the reasons of different quality level and quality perception. Therefore, it is necessary to conduct the internal quality audit and provide training at different position in order to gain the same level of quality perception in the project team.
Through the discussion and findings of this study, the causes and the consequences that generated by these missing processes can be summarized in the table below:
To summarize, refer to the study, in order to obtain a complete QMS, the missing requirements as previous mentioned should be added in the existing Quality Management System for fulfillment. More than that, the quality culture in organization should be formed up so that the Company can reach to the Total Quality Management.
His thesis abstract is copied and posted.
Abstract
The report expresses the key issues in Quality Management System (QMS) that known as the critical factor for any organization wants to develop and survive in the free trade market.
This study, which refers to the theories and the standards system, has expressed the concept of quality in construction, the QMS in organization, system requirements for owner’s QMS in construction and its benefits. The study has briefed the factors that most effect to project quality studied from public reports and the key points to control project quality from the design to construction stage. The report has introduced a QMS to the property developer for the purpose of amendment to the existing QMS in order to obtain a complete QMS for better managing project quality.
The next part of this report is the case study on the Estella J.V organization that established to run and deliver the Estella Residential Development project, an international project of the Keppel Land Co. Ltd. Through this case study, the findings on the existing QMS and the application from the previous part to this existing QMS for improvement will be the foundation QMS for toward Keppel Land’ projects. This is also the objective of this study.
Thursday, 16 September 2010
AIT Thailand August 2010 Intake for CEIM and MPM fields of Study
The AIT in Thailand accepted 49 students for August 2010 semester. The distribution of students enrolled in the Doctoral, Master and Professional Master Programs are 3, 9 and 37 respectively.
Below are names of the current students:
No. Name Degree
1. Mr.Grit Ngowtanasuwan, CAS
2. Mr.Wilson Udo Udofia, Doctor
3. MissSarsinatt Kriwaphun, Doctor
4. Mr.San Visal, Master
5. Mr.Ranjeet Sandeep Pundlik, Master
6. Mr.Senjam Romero Singh, Master
7. Mr.Krisana Juanwanpen, Master
8. Mr.Thanawat Phangchunun, Master
9. Miss Junya Phuangphay, Master
10. Mr.Pham Quang Cuong, Master
11. MissHuyen Thanh To, Master
12. Mr.Tran Phi Long, Master
13. Mr. Nguyen Duc Huan, MPM
14. Ms. Nguyen Thi Minh Ha, MPM
15. Mr. Nguyen Nhat Tai, MPM
16. Mr. Ngo Quoc Thai, MPM
17. Mr. Le Van Tuan, MPM
18. Mr. Nguyen Huu Ky, MPM
19. Mr. Vo Thanh Phong, MPM
20. Mr. Nguyen Ngoc Thi, MPM
21. Mr. Bui Duy Khanh, MPM
22. Mr. Nguyen Thai Son, MPM
23. Mr. Tran Minh Nghia, MPM
24. Mr. Le Anh Thai, MPM
25. Ms. Dang Trinh Thanh Phuong, MPM
26. Ms. Nguyen Tran Tuong Ly, MPM
27. Mr. Le Do, MPM
28. Mr. Nguyen Chanh Trung, MPM
29. Mr. Nguyen Nong Truong Thanh, MPM
30. Mr. Vo Khac Kien, MPM
31. Mr. La Nguyen Bao, MPM
32. Mr. Tu Thien Tu, MPM
33. Mr. Hoang Manh Chi, MPM
34. Mr. Chau Anh Tuan, MPM
35. Nguyen Thi Thu Nga, MPM
36. Mr. Ngo Thanh Duc, MPM
37. Nguyen Trong Hung, MPM
38. Mr. Bui Viet Thi, MPM
39. Mr. Nguyen Anh Tuan, MPM
40. Mr. Vu Van Tinh, MPM
41. Mr. Bui Thanh Nam, MPM
42. Mr. Huynh Thanh Quang, MPM
43. Mr. Do Danh Chi, MPM
44. Phan Hong Ngoc, MPM
45. Vu Kim Dien, MPM
46. Tran Cao Hy, MPM
47. Nguyen Trong Khoa, MPM
48. Nguyen Hong Thanh, MPM
49. Mr. Ha Chi Nghia, MPM
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